New York, NY – U.S. stock futures showed little movement on Sunday as investors grappled with multiple challenges, including Iran’s recent missile and drone strike on Israel. This event, compounded by a spike in market volatility, led to the Dow Jones Industrial Average experiencing its worst week of the year.
Futures linked to the Dow Jones Industrial Average saw a slight uptick of 0.13%, while S&P 500 futures rose by 0.14% and Nasdaq-100 futures inched up 0.06%. Gold futures continued their upward trend, climbing 0.4% to surpass $2,384 per ounce, driven by investors seeking refuge from inflation and geopolitical uncertainties.
The previous week saw significant losses in the Dow and the S&P 500, attributed to persistent inflation worries and a lackluster start to the first-quarter earnings season. The Dow plummeted 2.4%, marking its worst performance since March 2023, while the S&P 500 slid by 1.5%, recording its most significant decline since October 2023.
Over the weekend, Iran executed a direct attack on Israel through drone and missile strikes, raising concerns about potential retaliation and further escalations in the region. Oil prices, which had been on the rise due to escalating tensions in the Middle East, saw a slight decrease in response to the attack.
Market analysts are closely monitoring how Israel Prime Minister Benjamin Netanyahu will respond to the situation, with the Biden administration expressing a preference for Israel to refrain from retaliatory actions. Despite the uncertainty, there is cautious optimism that markets may see a relief rally if Israel heeds the advice of the U.S.
As investors await the earnings reports of companies like Goldman Sachs and M&T Bank, economic data including retail sales, business inventories numbers, and manufacturing figures are set to be released. Treasury yields fluctuated throughout the week, with rates easing on Friday as investors sought safety in Treasuries amidst geopolitical tensions.
Despite JPMorgan Chase surpassing profit expectations in its first-quarter report, concerns linger over lending prospects and inflationary pressures, further complicating the global economic landscape. The evolving situation underscores the importance of staying attuned to market developments and geopolitical events.