United States stock futures edged higher late Sunday (Monday AEDT) as investors attempted to stabilise markets after another negative week on Wall Street, while closely monitoring oil prices and the latest developments in the ongoing conflict between the United States and Iran.
By 10:10 am AEDT (11:10 pm GMT), futures tied to the Dow Jones Industrial Average, S&P 500, and Nasdaq-100 were each up around 0.3%.
The modest gains come after a difficult week for U.S. equities. The S&P 500 recorded its third consecutive weekly loss as major benchmarks closed at their lowest level of the year on Friday.
Over the week, the benchmark index declined 1.6%, while the Dow Jones Industrial Average lost 2%. The technology-heavy Nasdaq Composite fell roughly 1.3% over the same period.
Energy markets remained a key focus for investors after oil prices surged sharply last week amid disruptions to shipping through the Strait of Hormuz. The vital waterway, which handles a significant portion of global oil shipments, has seen traffic effectively halted since the conflict began.
Brent crude futures settled above $100 per barrel last week for the first time since 2022 as fears of supply disruptions pushed energy markets higher.
In early trading, West Texas Intermediate crude rose around 2% to US$100.88 per barrel, while Brent crude climbed 2.6% to $105.81.
Geopolitical developments continued to drive market sentiment. On Friday, President Donald Trump ordered strikes on Iranian military assets located on Kharg Island.
While the operation did not target oil infrastructure, Trump said the United States could consider striking such facilities if Iran continues blocking the Strait of Hormuz.
Trump also said over the weekend that Iran had indicated an interest in negotiating, although he signalled that Washington was not yet prepared to pursue a deal.
Investor sentiment may also have received some support from a report in the Wall Street Journal indicating that the United States plans to announce a coalition of countries to escort commercial vessels through the Strait of Hormuz.
Despite the geopolitical tensions and the surge in oil prices, the broader sell-off in equities has so far remained relatively contained. The S&P 500 is still trading only about 5% below the record high it reached earlier this year.
Market participants will also be watching developments in the technology sector this week, with Nvidia set to host its annual GTC conference beginning Monday. The event is closely followed by investors for announcements related to artificial intelligence and data-centre chips.
Attention will also turn to monetary policy, with the Federal Reserve scheduled to hold its second policy meeting of the year this week. Markets are broadly expecting the central bank to leave interest rates unchanged as policymakers assess inflation trends and the economic impact of rising energy prices.
