Wall Street futures skyrocketed early Wednesday morning following a high-stakes announcement of a two-week ceasefire between the United States and Iran. The agreement has temporarily pulled the world back from the brink of a massive escalation in the Middle East. US stock index futures posted massive gains, with Nasdaq 100 futures leading the charge, up 3.24%.

The Dow and S&P 500 minis jumped 2.3% and 2.5% respectively. Crude prices tumbled 16% to near $90 a barrel, as the deal raises hopes that Middle Eastern energy supplies-specifically through the strategic Strait of Hormuz-will resume. 

The relief rally was felt worldwide, with Asian and European markets surging between 4% and 5%. The VIX slid nearly 5 points, hitting its lowest level in over two weeks. The ceasefire announcement was reached late Tuesday, just hours before a deadline set by Donald Trump.

The President had previously threatened devastating attacks on Iranian civilian infrastructure if the Strait of Hormuz remained closed. Investors have endured a volatile month of warfare that saw the S&P suffer its biggest monthly fall in a year this past March. 

The drop in energy prices is expected to ease the inflationary pressure that recently had traders worried about a potential interest rate hike. In line with rate expectations, treasury yields slipped on Wednesday as current LSEG data suggests investors now expect the Fed to keep borrowing costs unchanged for the remainder of the year. This marks a significant shift from last month, when war-driven inflation concerns briefly led some to bet on rate hikes, abandoning earlier hopes for rate cuts.