US equity futures made modest gains on Monday as investors reacted to slightly lower oil prices and monitored diplomatic efforts to end the conflict between the United States and Iran. Market participants focused on emerging signs that negotiations, if successful, could reduce regional tensions and ease risks to global energy supply routes.
Futures contracts for the S&P 500 rose by 0.1% in early trade, extending last week’s positive momentum. Nasdaq-100 futures advanced 0.31%, while Dow Jones Industrial Average futures slipped by 60 points, or 0.13%.
Investor sentiment was shaped by news of ongoing discussions over the so-called “Islamabad Deal,” a proposed two-stage ceasefire aimed at de-escalating the US-Iran conflict and reopening the strategic Strait of Hormuz. The initiative, facilitated by Pakistan with support from China, calls for an immediate end to hostilities and a temporary period to negotiate a long-term settlement.
The framework sets out an initial ceasefire and passage reopening, followed by 15 to 20 days of further diplomatic talks for a permanent resolution. In return for assurances that Tehran will not pursue nuclear weapons, the agreement would see the removal of international sanctions and the release of Iran’s frozen assets. Senior officials from the US and Iran, including Pakistan’s army chief, US Vice President JD Vance, and Iran’s foreign minister, have been directly engaged in communications surrounding these negotiations.
