New York City, New York – Stock futures in the US saw a rise on Monday as concerns surrounding Iran’s attack on Israel diminished, allowing attention to shift back to earnings season and inflation risks impacting rate-cut hopes. S&P 500 futures increased by 0.4%, while Dow Jones Industrial Average rose by approximately 0.3%. The tech-heavy Nasdaq 100 led gains with futures up by 0.5%.
Investors are beginning to calm down as initial worries of a full-scale war in the Middle East subside following Iran’s direct missile and drone strike on Israel over the weekend. Efforts by the US to counsel Israel against retaliation have helped ease tensions, as the well-anticipated attack allowed for damage control.
As earnings season kicked off with a lackluster start, stocks faced pressure, while concerns lingered about inflation struggling to cool down to the Federal Reserve’s target of 2%. Traders have adjusted their expectations for the depth of Fed interest-rate cuts given disappointing economic data.
Market focus now turns to the upcoming results from Wall Street giants such as Goldman Sachs and Charles Schwab later in the day. Many investors are banking on robust corporate returns to reignite the earlier equity rally in 2024.
In the commodities sector, oil prices dipped by about 1% on Monday after an initial increase in anticipation of Iran’s air strike. West Texas Intermediate crude futures traded just below $85 a barrel, and Brent futures hovered above $89 a barrel.
Additionally, the 10-year Treasury yield added four basis points to trade near 4.57%, rebounding from a sharp decline on Friday to eye a return to last week’s five-month high level. Meanwhile, gold prices were 0.3% lower, having spiked by as much as 1.2% the previous week as tension in the Middle East escalated.
These shifting dynamics in the market demonstrate the delicate balance between geopolitical events, economic data, and corporate performance, influencing investor sentiments and market reactions. As uncertainties persist, market participants remain vigilant in monitoring developments and assessing the potential impacts on various asset classes.