Stock market today: Dow, S&P 500, Nasdaq futures rise on Iran peace prospects

US Stock Futures Advance as Reports Cite US-Iran Diplomatic Statements and Energy Price Moves

US stock index futures rose in early trading on Monday. Contracts tied to the Dow Jones Industrial Average increased 0.5 percent, S&P 500 futures gained 0.7 percent, and Nasdaq 100 futures rose 1 percent. Regular equity trading remained closed for the Memorial Day holiday.

Market participants referenced comments from President Trump indicating that negotiations with Iran were proceeding. Trump stated that talks were “moving along well” while also noting that the United States retained the option for military action if the discussions ended without agreement. Futures later trimmed some gains after reports described an exchange of fire in the Strait of Hormuz. The US military stated it carried out strikes on missile-launch sites and vessels in southern Iran as self-defense measures. Iran’s Islamic Revolutionary Guard Corps reported firing on a US F-35 aircraft and drones that had entered Iranian airspace and claimed to have downed an MQ-9 Reaper drone.

West Texas Intermediate crude futures fell nearly 5 percent after an initial spike. Brent crude futures declined more than 4 percent. Over the prior week, US oil prices dropped 8.4 percent, the largest weekly decline since mid-April. Lower energy prices coincided with the futures gains recorded earlier in the session.

Traders priced in an 8.5 percent probability of a Federal Reserve rate increase in July, according to CME Group’s FedWatch tool, compared with 0.9 percent one month earlier. The shift followed sustained higher energy costs that had altered prior expectations for monetary policy easing.

Additional details emerged from statements issued after the Strait of Hormuz incidents. President Trump repeated that talks aimed at extending a ceasefire and reopening the strait were continuing. Iran’s Supreme Leader Mojtaba Khamenei issued a statement that the nations and lands of the region would no longer serve as a shield for American bases. US Secretary of State Marco Rubio, speaking in India, said discussions involved specific language in an initial document and would require several days.

The US military described its strikes as targeting sites and boats near Larak Island. Iranian state media reported that several personnel were killed in the vessel attacks but provided no further numbers. Israel’s military stated it did not participate in the US operation.

Markets had closed the previous week with the S&P 500 above 7,500. The week ahead includes earnings reports from semiconductor and retail companies, the Conference Board consumer confidence survey on Tuesday, and the Personal Consumption Expenditures price index on Thursday.

Scheduled data releases on Tuesday comprise the ADP weekly employment change, Chicago Fed national activity index, Philadelphia Fed non-manufacturing activity, FHFA housing price index, Conference Board consumer confidence and its component readings, and Dallas Fed manufacturing activity. Companies reporting earnings include AutoZone, Elbit Systems, Zscaler, and Pony AI.

Oil prices later recovered some ground but remained lower on the session. The sequence of diplomatic statements, military actions, and price movements occurred within a single 24-hour period spanning the holiday weekend and Tuesday morning.