U.S. equity futures softened early Monday as heightened tensions in the Strait of Hormuz and stalled Iran peace efforts drove oil prices higher. Investor focus remains fixed on geopolitical developments and forthcoming megacap earnings amid persistent inflation concerns.
At 4:38 p.m. (Bangkok Time), Dow Jones Industrial Average futures slipped 0.14% during premarket trading, while contracts for the S&P 500 and Nasdaq moved largely flat. The market mood was influenced in part by fresh developments in the Middle East after unsuccessful peace negotiations increased fears of disruptions to global oil supply.
According to sources cited by Axios, Iran has put forward a new offer to the United States, aiming to reopen the Strait of Hormuz and propose a ceasefire, while suggesting nuclear discussions be postponed. Diplomatic progress stalled over the weekend, as both parties stepped back from direct engagement.
Over the weekend, President Donald Trump cancelled plans to dispatch special envoy Steve Witkoff and advisor Jared Kushner to Pakistan for Iran-related ceasefire talks, indicating discussions may instead occur by phone.
Tensions escalated near the Strait of Hormuz after Iran’s Islamic Revolutionary Guard Corps seized two container vessels in the critical waterway. In response, West Texas Intermediate oil futures advanced 2.39% to trade at $96.66 per barrel, while Brent crude jumped 2.74% to exceed $108.22 per barrel on Monday.
The upcoming week is marked by several key events for investors. Earnings reports from five of the seven major technology companies, often referred to as the “Magnificent Seven,” are set for release and could provide a test for equities, which have demonstrated resilience through the ongoing Iran conflict.
Additionally, the Federal Reserve’s policy statement is due, in what is anticipated to be Jerome Powell’s second-to-last meeting before a planned transition to incoming chair Kevin Warsh.
