Wall Street futures traded cautiously early Monday as stalled US–Iran peace talks and a sharp rise in oil prices tempered investor sentiment ahead of a crucial week of earnings and central bank commentary.
E-mini S&P 500 futures were marginally lower, down 0.07% at 7,189.50 as of 4:48 a.m. GMT-5, while Nasdaq-100 futures edged up 0.07% to 27,455.00, reflecting a mixed but subdued risk appetite.
Investor focus remains split between resilient corporate earnings and escalating geopolitical risks.
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According to LSEG data, 81.3% of the 139 S&P 500 companies that have reported so far have beaten earnings expectations, above the four-quarter average of 78.1%. However, analysts caution that these results capture only the early phase of Middle East disruptions.
“We are suffering from a distinct lack of clarity at the moment. There is also a growing divergence among financial market participants,” Richard de Chazal, macro analyst at William Blair, told Reuters. “Equity market investors seem to have moved on from the war and are back on the AI technology trade. Meanwhile, commentary from participants in the commodity markets continues to signal that the shock is being completely underestimated," he added.
Oil prices surged past $107 per barrel, with Brent crude rising over 2% in Asian trade, nearly 49% above pre-war levels, reintroducing a “fear premium” into energy markets and complicating the global inflation outlook.
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The spike in crude is reinforcing expectations that interest rates may stay higher for longer, particularly as the US Federal Reserve prepares to signal its policy stance this week.
Despite macro headwinds, equity markets have shown resilience, supported by continued optimism around artificial intelligence. Chip stocks remained in focus, with Qualcomm rising 10.6% in premarket trading and Intel gaining 2.7%, extending a sharp rally from the previous session.
Geopolitical developments remain fluid, with uncertainty around the Strait of Hormuz and broader Middle East dynamics continuing to drive market sentiment. An Axios report suggesting Iran may consider a limited “strait-first” agreement offered brief relief, though a comprehensive deal remains elusive.
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