Oil drops, stocks gain amid Iran peace hopes; yen firms as investors watch for further intervention

NEW YORK/LONDON, Aug 3 (Reuters) - Oil prices dropped and major stock indexes gained on Monday on signs that U.S.-Iran tensions were easing again, while the yen strengthened after the U.S. and Japan confirmed joint intervention to support the currency ‌and investors watched for signs of further intervention.

U.S. President Donald Trump over the weekend held off on a fresh attack on Iran.

Trump ‌said on Monday that talks with Iran were under way, warning that it was a "last chance" for Tehran to sign a good deal to end the five-month-old war, but Iran denied that ​any negotiations were being held or planned.

Front-month Brent futures fell $6.35, or 7.0%, to settle at $83.77 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $4.33, or 5.1%, to settle at $80.34.

The Dow registered a record closing high, with optimism over earnings also helping to underpin equities.

"The sharp drop in oil prices, due to Trump's cancelling severe attacks against Iran and hopes of a diplomatic resolution, set the ball rolling this morning," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

Also a ‌plus, "so far most of the earnings have beat expectations," ⁠and guidance has been upbeat, he said. More than 300 of the S&P 500 component companies have reported earnings so far, with roughly 85% of firms beating expectations, according to LSEG data.

Amazon's market value topped $3 trillion for the first time on ⁠Monday, helped by a sharp rally following its recent strong earnings and signs that the AI boom is driving fresh demand for its cloud-computing services. Amazon shares ended 4.6% higher on the day.