S&P 500 Stages Massive Intraday Comeback
U.S. stocks saw a wild session on Monday as the S&P 500 staged its largest intraday comeback since November, recovering from a 1.1% drop to close positive. The dramatic rebound, driven by a spike in oil prices and rotation into energy stocks, came despite early panic from the Iran crisis and dire social media predictions of a market collapse.
The early session sell-off on Monday, March 2, 2026, was a direct reaction to joint U.S.-Israeli airstrikes against Iran over the weekend. This military action sparked fears of a broader conflict and immediate disruptions to oil shipments through the Strait of Hormuz, a critical chokepoint for about 20% of the world's oil supply. The initial market reaction saw global stock markets slump, with London's FTSE 100 and Germany's DAX falling 1.2% and 2.4% respectively. The dramatic reversal in U.S. markets was largely fueled by a surge in energy prices, with West Texas Intermediate (WTI) crude futures climbing nearly 6% to around $71 a barrel. This price jump directly benefited energy stocks, with the S&P 500 Energy sector hitting a record high and marking its largest one-day gain in weeks. The U.S.'s position as a net energy exporter since 2019 helped insulate its markets from the level of turmoil seen in Europe and Asia. Despite the S&P 500's positive close of 0.04%, other major U.S. indices had a mixed finish. The Dow Jones Industrial Average ended the day down 0.15%, or about 73 points, while the tech-heavy Nasdaq Composite posted a gain of 0.36%. The volatility index (VIX) jumped to 21.5, after peaking at 25 earlier in the session, indicating a significant increase in market uncertainty. The day's trading marked the S&P 500's most significant intraday comeback since November 7, 2025. The resilience was also supported by positive economic data, with the Institute for Supply Management's Purchasing Managers Index showing expansion in the U.S. manufacturing sector for the second consecutive month. Looking ahead, analysts remain cautious, pointing to the potential for sustained high oil prices to fuel inflation and potentially disrupt plans for interest rate cuts. The duration of the conflict in the Middle East and its impact on oil supply through the Strait of Hormuz are seen as critical factors for market stability in the coming weeks.
