U.S.-Iran Ceasefire Holds Amid Domestic Scrutiny and Market Relief

The two-week ceasefire reached between the United States, Iran, and Israel has brought a tentative calm to the Middle East, with global focus shifting to the reopening of the Strait of Hormuz. President Trump characterized the agreement as a significant diplomatic victory, noting that the restoration of shipping traffic—which accounts for 20% of global oil and gas—will stabilize energy markets and lead to economic opportunities through reconstruction and supply shipments. However, the situation remains fluid; Bahrain activated missile sirens early Wednesday morning following reports of Iranian missile activity that occurred shortly after the deal's announcement. Domestic reaction in the U.S. has been split. White House spokesperson Karoline Leavitt framed the deal as a success of military leverage, while Republican hawks like Senator Lindsey Graham have expressed caution, demanding a thorough congressional review. Some former administration officials have criticized the deal, suggesting Iran may emerge in a stronger position despite the reopening of the Strait. Meanwhile, Israeli officials have clarified that their participation in the ceasefire does not extend to their operations in Lebanon. In Tehran, state media is portraying the pause in hostilities as a U.S. "retreat," contrasting current diplomatic efforts with President Trump’s earlier rhetoric regarding the closure of the Strait. Despite these conflicting narratives, international markets have responded positively, with stocks and Treasuries rallying. Further de-escalation talks are scheduled to take place this Friday in Islamabad, hosted by Pakistani Prime Minister Sharif.