Crude oil slumps 10% and Wall Street rallies toward another record after Strait of Hormuz opens

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NEW YORK (AP) — Oil prices are falling by more than 10%, and Wall Street is rallying toward another record after Iran said the Strait of Hormuz is fully open, which would allow oil tankers to exit the Persian Gulf again and carry crude to customers worldwide. The S&P 500 rallied 0.7% as U.S. stocks sprinted toward the finish of a third straight week of big gains. The Dow Jones Industrial Average rose 1%, and the Nasdaq composite added 1%. Stocks have rallied more than 11% since late March on hopes that the United States and Iran can avoid a worst-case scenario for the global economy.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Wall Street is on track to close out its third consecutive winning week and oil prices slid more than 3%, driven down by a truce between Israel and Lebanon.

Futures for the Dow Jones Industrial Average rose 0.5%, while futures for the S&P 500 and Nasdaq one day after both ticked up 0.3% Friday.

President Donald Trump late Thursday announced a 10-day ceasefire between Lebanon and Israel that began early Friday and so far, appears to be holding. That boosted optimism for an extension of a tentative truce between Iran, the U.S. and Israel.

It was unclear whether a lasting deal would be reached before the ceasefire ends next week, but the pause in fighting between Israel and Hezbollah was seen as progress.

Trump suggested that he’s open to extending the two-week ceasefire, and Iran’s U.N. envoy said Tehran remained “cautiously optimistic” over negotiations with the U.S.

As optimism spreads, oil prices are falling. Benchmark U.S. crude slid $3.39 to $87.78 a barrel, the lowest level in weeks.

Brent crude, the international standard, fell 3.2% lower at $96.15 per barrel. It had surged roughly 40% since the beginning of the Iran war in late February.

Global energy shocks appear to be worsening with the Strait of Hormuz remaining largely closed after the U.S. imposed a sea blockade on Iranian ports. The head of the International Energy Agency told The Associated Press on Thursday that Europe has “maybe six weeks or so” of jet fuel supplies remaining and warned of flight cancellations “soon.”

U.S. banks began releasing quarterly results this week and late Friday, Netflix made a sizeable announcement regarding its leadership.

Shares tumbled more than 10% overnight after the streaming giant announced that cofounder and chairman Reed Hastings will step down from the board of directors in June. The company's outlook also disappointed investors despite strong quarterly results.

At midday in Europe, Britain's FTSE 100 index was down 0.2%. France's CAC 40 was 0.4% higher and Germany's DAX gained 0.5%.

Asian stocks were mostly lower. Tokyo’s Nikkei 225 fell 1.8% to 58,475.90 after reaching an all-time high on Thursday. South Korea’s Kospi was 0.6% lower at 6,191.92.

Hong Kong’s Hang Seng dropped 0.9% to 26,160.33. Shares of Chinese spatial design software firm Manycore Tech, one of the so-called leading “six little dragons” technology companies of Hangzhou, was up more than 140% on its first day of trading in Hong Kong, fueled by the artificial intelligence boom. The Shanghai Composite index edged down 0.1% to 4,051.43.

Australia’s S&P/ASX 200 lost 0.1%. Taiwan’s Taiex traded 0.9% lower, while India's Sensex gained 0.7%.