US stock futures climbed on Monday, eyeing a rebound as jitters over a widening in the Israel-Iran conflict started to recede despite an exchange of missile strikes throughout the weekend.
Dow Jones Industrial Average futures (YM=F) rose 0.4%, while those on the S&P 500 (ES=F) moved up 0.5%. Contracts tied to the Nasdaq 100 (NQ=F) gained 0.6%. The cautious optimism follows a bruising Friday session that saw the Dow plunge more than 700 points in a broad risk-off move.
Meanwhile, oil (CL=F) prices edged lower after jumping in the wake of the latest attacks, having surged last week to their highest levels since January.
The geopolitical flare-up comes at a delicate moment for markets already buffeted by tariff insecurity. Friday’s selloff dragged the major US indexes into negative territory for the week.
Read more: The latest on Trump’s tariffs
Now investors are regaining some appetite for risk amid rising optimism that the conflict won’t spill over into a broader regional crisis. President Trump said on Sunday there’s a “good chance” of an Israel-Iran peace deal, but the hostilities may need to play out first. “Sometimes they have to fight it out, but we’re going to see what happens,” he told reporters.
A measure of calm is also returning to the oil market, rattled by fears of disruption to the global energy supply. Tehran has hinted it may close the Strait of Hormuz, a critical chokepoint for roughly one-fifth of the world’s oil.
Crude oil jumped out of the gate on Sunday evening after the dramatic weekend of retaliatory strikes targeting energy infrastructure on both sides. West Texas Intermediate (CL=F) futures spiking over 6% to top $76 a barrel, while Brent crude (BZ=F) saw a similar move to just below $78 a barrel.
But futures turned lower on Monday, down well over 1% to pull Brent toward $73 a barrel and WTI to below $72 a barrel.
Gold (GC=F) prices also pulled back, having rallied alongside oil as it drew safe-haven flows amid rising volatility. The precious metal traded lower at around $3,440 an ounce.
On the trade front, the EU is reportedly ready to accept US tariffs of 10% across all its exports — the baseline for Trump’s “reciprocal” hikes — as the president puts pressure on trading partners to reach a deal. The offer is a bid to avert higher rates on cars, drugs, and electronics, Handelsblatt reported.
Looking ahead, investors will be parsing fresh data on Monday from the New York Fed’s Empire State Manufacturing Survey for signs of economic resilience, or weakness, ahead of Wednesday’s interest rate decision from the Federal Reserve.