TL;DR

The House voted 215 to 208 Wednesday to adopt a war powers resolution limiting Trump's authority over military operations in Iran, in the first successful congressional vote of its kind since the conflict began. Oil logged a third straight session of gains, with Brent near $98 per barrel and WTI above $95. US stocks snapped a nine-session winning streak during the regular session, with the Dow shedding more than 600 points. Then, shortly after the closing bell, Broadcom reported weaker-than-expected AI chip guidance, pushing shares down more than 6% in after-hours trading. Heading into Thursday, futures traders face a two-catalyst reset.

What Happened

The House of Representatives voted 215 to 208 on Wednesday to adopt a war powers resolution that would rein in Trump's authority over US military operations in Iran. The vote was bipartisan, with several Republicans crossing the aisle to join Democrats. It marks the first time Congress has successfully passed such a resolution since the conflict began roughly three months ago, per reporting from the New York Times and CNN.

Trump is expected to veto the resolution, which would leave military operations on their current legal footing. But the vote signals a meaningful fracture in Republican support for the war and adds a layer of political uncertainty that oil markets are now factoring in alongside the ongoing physical supply disruption.

The Strait of Hormuz, the narrow waterway between Iran and Oman through which roughly 20% of global oil supply transits, remains largely closed. The dispute over its reopening has been central to stalled ceasefire negotiations. For background on how the Hormuz disruption escalated through late May, see our earlier coverage: Iran Targets Kuwait Base, Blocks Ships at Hormuz as Trump Weighs Ceasefire Sign-Off.

On the energy side, Brent crude futures climbed toward $98 per barrel on Wednesday, marking a third straight session of gains. WTI crude, the US benchmark, held above $95 per barrel. Ongoing uncertainty surrounding US-Iran peace negotiations continues to sustain the geopolitical risk premium baked into crude prices, per TradingEconomics.

During the regular trading session, the sustained oil rally and a corresponding rise in US Treasury yields weighed on growth stocks and software names. Higher Treasury yields reflect market expectations of tighter monetary policy, partly because rising energy costs feed into inflation. The Dow Jones Industrial Average, a price-weighted index of 30 large US companies, fell 620.72 points, or 1.21%, to close at 50,687.07. The S&P 500 slipped 0.74% to 7,553.68, snapping a nine-session winning streak that had briefly taken the index above 7,600 for the first time. The Nasdaq Composite dropped 0.89%, and the small-cap Russell 2000 declined 1.25%. Gold futures fell 0.78% to settle near $4,484 an ounce, per Investopedia.

Then, roughly 30 minutes after the closing bell, Broadcom (AVGO) reported its fiscal second-quarter results. Revenue came in at a record $22.19 billion and earnings per share hit $2.44. Both figures were strong. The problem was the forward guide: Broadcom's AI chip sales forecast for the current quarter came in at $16 billion, short of the $17.2 billion Wall Street had expected. CEO Hock Tan also did not raise the company's full-year AI revenue target of $100 billion, which many on the Street had anticipated, per CNBC. Shares fell more than 8% in extended trading, later stabilizing around a 6% loss near $453.70. As of 6:20 p.m. ET, futures tied to major US indexes were trading near the flatline, indicating no sharp directional bet on Thursday's open had yet been established.

Why the House Vote and Oil Surge Are Moving Markets

The US-Iran conflict, now roughly three months old, removed a significant share of global crude supply and disrupted access to the Strait of Hormuz. With roughly one-fifth of global oil trade passing through that 21-mile-wide waterway, and the channel still largely closed, the supply risk premium in crude has remained elevated throughout the spring.

At chartdojo.io, we see this oil-inflation dynamic play out in real-time trader behavior. When crude sustains above $90 and Treasury yields move in tandem, the resulting inflation anxiety compresses risk appetite across stocks and crypto simultaneously. That is the pattern active today. The US is already running CPI at 3.8% and PPI at 6% as of the most recent government readings, and further oil-driven cost pressure makes it harder for the Federal Reserve to cut rates. Markets have been pricing an increasing probability of a rate hike later this year.

Wednesday's war powers vote adds a new variable. A Trump veto keeps the war legally intact. But the bipartisan nature of the vote signals to Iran's negotiators that domestic US political support for the conflict is eroding. That could either accelerate diplomacy or allow Iran to hold firmer in talks, knowing congressional pressure is building on the US side.

Implications for Traders

Equity and index futures traders: The S&P 500 broke a nine-session record run, and the Broadcom guidance miss is the most immediate setup for Thursday. Watch whether NQ (Nasdaq 100 futures) and ES (S&P 500 futures) gap lower on the AI guidance miss or stabilize. The key question is whether traders treat Broadcom's shortfall as company-specific or as a signal about broader AI infrastructure spending trajectories across Nvidia, Marvell, and similar names.

Energy and commodities traders: WTI above $95 and Brent near $98 is a third consecutive daily gain. A sustained break above $100 on Brent would generate fresh inflation-anxiety headlines and likely push Treasury yields higher. On the downside, any credible development in peace negotiations could flush speculative long positions quickly. The EIA weekly crude inventory data is due Thursday; a sixth consecutive drawdown in US stockpiles would add upward oil pressure.

Crypto traders: Bitcoin was trading below $67,000 Wednesday, down from recent highs above $74,000. Ethereum was near $1,860, below the $2,000 level. The primary drag on both assets is the rising probability of a Federal Reserve rate hike. Without a clear catalyst for a Fed pivot, crypto's near-term upside is constrained by the same rate-sensitive conditions weighing on growth stocks.

Potential Positives vs Negatives

Positives: The congressional vote, however symbolic, increases bipartisan pressure on the White House to pursue a faster diplomatic resolution. A peace deal and Hormuz reopening would almost immediately relieve oil prices, ease inflation expectations, and give the Fed more room to hold or cut. That sequence would be broadly positive for equities and crypto. Broadcom's actual revenue of $22.19 billion was a record quarter; the AI buildout has not reversed, it simply decelerated relative to very high expectations.

Negatives: A Trump veto keeps operations unchanged. If the ceasefire continues to be tested by back-and-forth attacks as it has been since late May, the geopolitical risk premium in oil could deepen rather than ease. On the tech side, Broadcom's guidance miss may push analysts to revisit assumptions for Nvidia, Marvell, and other AI infrastructure names that drove the S&P 500 to record highs earlier this week.

What Could Happen From Here: Base, Upside, and Downside

Base case (next 24-72 hours): Trump vetoes the war powers resolution, diplomatic talks continue at their current pace, and oil consolidates in a $92-99 range on Brent. The Nasdaq recovers modestly as traders decide Broadcom's miss is company-specific rather than a sector-wide signal. Confirmed by: a stable overnight futures session and no new military incidents in the Strait of Hormuz region. Invalidated by: oil breaking sharply in either direction, or a second major AI guidance miss from another chip name reporting this week.

Upside case: The congressional rebuke accelerates back-channel diplomacy and Iran agrees to a framework for reopening Hormuz in exchange for partial sanctions relief. Oil drops 5-8% in a session. Rate-hike probabilities fall. Growth stocks and crypto recover. Confirmed by: headlines citing specific deal terms or a White House statement on imminent negotiation progress. Invalidated by: Trump publicly rejecting any Hormuz framework or a fresh military escalation in the strait.

Downside case: Iran responds to the congressional rebuke or to ongoing US naval pressure with a new escalation. Brent pushes toward or above $105. Inflation expectations spike, Treasury yields climb further, and growth stocks extend the Wednesday decline. Confirmed by: new attack reports, a formal strait-closure announcement, or oil futures opening sharply higher in Asian trading Thursday. Invalidated by: both sides holding to the existing nominal ceasefire and oil stabilizing below $98.

What to Watch Next (Next 24 Hours)

  • Trump's formal response to the House war powers vote, expected Thursday
  • Overnight US index futures direction, particularly NQ on the Broadcom after-hours reaction
  • Brent crude at the European open Thursday; $98 is the immediate level to watch
  • CrowdStrike (CRWD) earnings, also reporting Wednesday after hours
  • EIA weekly crude inventory data due Thursday; a sixth consecutive drawdown would add upward oil pressure
  • Any statement from Iranian officials on Hormuz or the status of ceasefire negotiations

Frequently Asked Questions

What is the Strait of Hormuz and why does it matter for oil prices? The Strait of Hormuz is a roughly 21-mile-wide sea passage between Iran and Oman. Approximately 20% of global oil supply transits the strait. When access is disrupted, crude prices typically rise because the supply cannot easily be rerouted through alternative channels.

Does the House war powers vote change US military operations immediately? No. A presidential veto, which Trump is expected to issue, would block the resolution from taking legal effect. The primary market impact is political: it signals significant congressional opposition and may increase pressure on the administration to accelerate a diplomatic resolution.

Sources

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