US Stock Futures Rise as US-Iran Ceasefire Talks Ease Market Fears

TLDR

• S&P 500 futures rose 0.4% and Nasdaq 100 futures gained 0.6% on Monday
• Peace talks between the US and Iran, mediated by Pakistan, lifted market sentiment
• Trump pushed his Iran deadline to Tuesday evening, threatening to destroy Iran’s power plants
• The Strait of Hormuz remains largely closed, affecting around 20% of global oil traffic
• Oil prices fell after ceasefire reports, with Brent crude down around 1.6% to $107 a barrel

US stock futures moved higher on Monday as reports of possible peace talks between the US and Iran gave investors some relief. The gains came after a tense weekend of missile strikes and renewed threats from President Trump.

Futures on the S&P 500 rose around 0.4%. The Nasdaq 100 gained 0.6%. Dow Jones Industrial Average futures were up a smaller 0.1%.

Markets had briefly fallen overnight after Trump renewed his threats against Iran. But they recovered as diplomatic reports offered a glimmer of hope.

Reuters reported that both the US and Iran had received a draft ceasefire plan mediated by Pakistan. The plan would involve an immediate halt to attacks. Neither side has publicly confirmed or accepted the proposal.

Separately, the US and regional mediators are pushing for a 45-day ceasefire that could end the war entirely. However, officials familiar with the matter say the chances remain slim.

Trump’s original 10-day deadline for Iran technically expired Monday. But Trump extended it, posting on social media that the new cutoff is “Tuesday, 8:00 P.M. Eastern Time.” He told the Wall Street Journal the US would destroy all of Iran’s power plants if the Strait of Hormuz was not reopened by then.

Oil Prices Fall on Ceasefire Reports

The Strait of Hormuz, through which around 20% of the world’s oil normally flows, remains effectively closed to most tankers. That closure has kept oil prices elevated in recent weeks.

Oil prices had jumped nearly 3% when markets opened Sunday night. But they turned lower after the ceasefire reports. Brent crude fell around 1.6% to about $107 a barrel. West Texas Intermediate dropped roughly 2% to around $109.

One unusual detail: WTI prices were trading above Brent prices. That is rare. Analysts say it is due to a timing difference in futures contracts, with WTI still on the May delivery month while Brent has rolled to June.

Analysts at Gavekal Research wrote that Iran appears to be using its control of the strait to charge ships steep toll fees for passage. They described it as a new economic model for the region.

Other Markets

Gold rose 0.9% to around $4,720 an ounce on Monday. The yield on the 10-year US Treasury note ticked up to 4.362%.

US forces rescued an American aviator who had been trapped in Iran over the weekend. Tehran continued to fire missiles and drones into Gulf countries and Israel through Monday morning.

The situation remains fluid, with the Tuesday evening deadline now the next key moment for markets and diplomacy.

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