US stock futures rose on Monday as worries over Iran’s attack on Israel eased, with focus shifting back to earnings season and inflation risks. S&P 500 and Dow Jones Industrial Average futures both climbed, with the tech-heavy Nasdaq 100 leading the gains. Investors showed signs of relief as concerns of a full-blown war in the Middle East subsided following the well-managed direct missile and drone strike by Iran on Israel.
Efforts by the US to discourage Israel from retaliating after the attack helped calm nerves and stabilize the markets. However, lingering worries about inflation and lackluster start to earnings season have kept traders cautious. Expectations for an aggressive rate-cutting stance by the Federal Reserve have also been tempered by disappointing economic data. As corporate earnings become the focus, results from heavyweights like Goldman Sachs and Charles Schwab are awaited to potentially revive the early 2024 equity rally.
In commodity markets, oil prices dipped slightly after an initial rise ahead of the Iran attack, while Treasury yields saw a modest increase. Geopolitical tensions, particularly in the Middle East, remain a key factor to watch as they could have ripple effects on the global economy and central bank policies. As markets navigate through these uncertainties, investors are keeping a close eye on the evolving situation and its potential impact on various asset classes.