United States stock futures traded lower on Monday evening (Tuesday AEST) as investors remained focused on the ongoing conflict between Israel and Iran ahead of key economic data and central bank policy signals.
At 8:55 am AEST (10:55 pm GMT) Dow Jones Industrial Average futures and S&P 500 futures fell 0.2%, while Nasdaq 100 futures slipped 0.3%.
The modest moves followed a rebound in regular trading hours. The Dow gained 0.8%, while the S&P 500 advanced 0.9%. The tech-heavy Nasdaq Composite jumped 1.5%, leading the day’s gains.
Investor sentiment was supported by a decline in oil prices, reversing part of last week’s sharp rally. Brent crude and West Texas Intermediate futures each fell more than 1% on Monday after soaring on Friday following Israeli airstrikes on Iran’s nuclear and energy facilities.
Despite continued military action for a fourth consecutive day, markets found comfort in diplomatic overtures.
According to NBC News, Iran has asked several countries — including Saudi Arabia and Qatar — to press U.S. President Donald Trump to influence Israel towards a ceasefire.
However, Israeli Prime Minister Benjamin Netanyahu reaffirmed that the country’s objective in launching Friday’s offensive is to dismantle Iran’s nuclear program, ballistic missile production, and its network of regional militant groups, stating that Israel would not agree to a ceasefire without achieving these aims.
Looking ahead, investors will watch closely for Tuesday’s release of May retail sales data. This could offer clues about consumer spending strength and the broader economic outlook.
The most anticipated event of the week remains the Federal Reserve’s policy decision, scheduled for Wednesday afternoon. According to CME Group FedWatch Tool, futures markets price in near certainty that the Fed will leave interest rates unchanged, maintaining its current target range of 4.25% to 4.50%.
Market participants will focus on the central bank’s language and projections for any clues about the timing of potential rate cuts later this year.
