Wall Street futures jumped after US Iran deal eases oil fears – mezha.net

Markets jumped on a preliminary US Iran agreement, but key issues remain unresolved and volatility could return as the Fed meeting approaches.
Based on data from Reuters
Futures on major Wall Street indices rose on Monday after Washington and Tehran reached a preliminary agreement to end the war with Iran and restore the crucial Hormuz Strait, which sparked a sharp drop in oil prices to a three-month low.
At the same time, the framework agreement does not cover such thorny issues as Iran’s nuclear program and the conflict between Lebanon and Israel. It is expected that the agreement will be formally signed in Switzerland on Friday.
If night news of the US-Iran deal proves credible and lasting, this should be viewed as positive, while failures are more likely to be perceived as less negative by risky assets.
– Max Kettner, Head of Multi-Asset at HSBC Global Investment Research
In premarket trading, chipmakers’ shares rose: Micron up 8.2% after several brokerages raised their price targets, Nvidia up 2.3%, Intel up 3.1%, and Marvell Technology up 5.4%.
Oil prices surged after the news: oil futures fell more than 4% and hit a March low, supporting airlines and cruise lines sensitive to fuel costs.
United Airlines rose 4.4%, Delta Airlines added 4%, American Airlines rose 3.5%, while Norwegian Cruise Line and Carnival rose 4.3% and 3.6% respectively.
Analysts warn that Brent crude prices may stay around the $80 per barrel mark despite the easing of tensions, as energy flows resume through Hormuz and regional countries rebuild infrastructure.
Data from the prior week indicate higher energy costs are seeping into consumer inflation, keeping attention on the Fed’s forecasts during the planned monetary meeting this week.
The yield on two-year Treasuries fell to a multi-week low, and the VIX volatility index dropped to a level below its intra-week peak after its earlier rise.
The expectation remains that the Fed will hold rates steady this week, though traders still forecast borrowing costs to rise by at least 25 basis points by year-end, according to the CME FedWatch tool.
At 4:45 a.m. ET, Dow E-mini futures were up 480 points (0.94%), S&P 500 E-minis up 95.75 points (1.29%), Nasdaq 100 E-minis up 653.75 points (2.2%).
SpaceX shares jumped 5.6% after Elon Musk’s company completed its massive IPO valued at more than $2 trillion.
Markets noted SpaceX’s calm trading on Nasdaq, setting a new pattern for companies and exchanges preparing for future major OpenAI and Anthropic IPOs this year.
All three major indices finished the week higher, despite pressure on AI-sector stocks at the start of the week. Analysts point to the tech sector’s sensitivity to higher interest rates and positioning ahead of SpaceX’s IPO as factors driving market volatility.
This week, investors’ attention will focus on the first meeting chaired by Fed Chair Kevin Warsh, where investors will assess his communication style and the economic outlook for rates.
In other market moves, Paramount Skydance shares rose 4.7% after the U.S. Department of Justice approved the Warner Bros. acquisition.
Overall the market continues to seek direction after the latest news and prepares for further decisions in monetary policy and major corporate deals.
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