Stock futures experienced a notable rise on Monday night after former President Donald Trump declared a ceasefire timeline intended to alleviate tensions between Israel and Iran. Futures tied to the Dow Jones Industrial Average increased by 134 points, equivalent to a 0.3% gain. Additionally, S&P 500 futures climbed 0.4%, while Nasdaq 100 futures saw a 0.6% rise, reflecting a positive market sentiment following Trump's announcement.
The surge in stock futures came after Trump shared the ceasefire timeline on his platform, Truth Social, suggesting a potential resolution to the ongoing conflict between Iran and Israel. In the regular trading session, all three major indices experienced gains, as investors appeared to overlook Iran's recent retaliatory strike on a U.S. military base located in Qatar. The Qatar Defense Ministry confirmed that its air defense system successfully intercepted the attack, ensuring no casualties were reported from the incident.
On the same day, oil prices witnessed a decline, providing a favorable backdrop for stocks. Following a spike to their highest levels since January, West Texas Intermediate futures fell by over 7%. Arjun Murti from Veriten commented on CNBC's Closing Bell: Overtime, stating, "We probably built as much as a $15 to $20 per barrel premium in oil over the last week compared to our trading levels prior to the Israel-Iran situation. We are now in the process of eliminating that." He further noted that the market sentiment suggests optimism, indicating that “it looks like the worst of this turmoil is behind us.”
As traders look ahead, all eyes will be on Federal Reserve Chairman Jerome Powell, who is scheduled to speak before the House Financial Services Committee on Tuesday morning. His testimony, which will include the central bank's monetary policy report, comes at a critical juncture as he faces pressure from the White House to implement interest rate cuts. On Wednesday, Powell will address the Senate Banking Committee, further shaping market expectations.
In addition to Powell's testimony, traders will also keep an eye on upcoming economic releases, including home price data and the consumer confidence index for June. These indicators will provide further insight into the economic landscape as the market navigates through these turbulent times.
Reporting contributed by CNBC's Jeff Cox.
