ISTANBUL

US stocks closed Tuesday with gains after US President Donald Trump announced that a ceasefire was reached between Israel and Iran, suspending armed conflict which began on June 13.

The Dow was up 1.19%, or 507.24 points, to close at 43,089.02.

The S&P 500 earned 1.11% to 6,092.18 points, and Nasdaq composite gained 1.43% to finish at 19,912.53.

Airline stocks were higher as oil fell, with shares of United Airlines, Frontier and Delta all climbing more than 2%.

Tech firms such as Broadcom and Nvidia advanced 3.9% and 2.5%, respectively, as investor appetite for risk grew.

The truce was initially announced by Trump, who said it would involve a phased halt to operations, with Iran beginning the ceasefire first and Israel following 12 hours later. A full end to hostilities would then be declared at the 24th hour, he said.

Iranian President Masoud Pezeshkian said that Iran will abide by a ceasefire if Israel does not violate it.

Meanwhile, Fed Chair Jerome Powell reiterated that they are well-positioned to wait to learn more about the likely course of the economy before considering any adjustments to the policy stance of the central bank.

He also said the effects of tariffs will depend on their final levels and increases in tariffs this year are likely to push up prices and weigh on economic activity.

Oil prices fell following the announcement of the ceasefire, after reaching 2-month high levels with concerns that Iran may close the Strait of Hormuz.

The price of Brent crude fell around 3.7% Tuesday to $66.80 per barrel.

On the macroeconomic data side, the US current account deficit rose 44.3% to $450.2 billion in the first quarter, above expectations.

Conference Board's US Consumer Confidence index unexpectedly fell by 5.4 points to 93 in June.

The VIX Index, also known as the “fear index," dropped 11.85% to 17.48.