TLDR
- Stock futures rebounded Monday with Dow futures up 0.4%, S&P 500 futures gaining 0.5%, and Nasdaq futures climbing 0.6%
- Oil prices retreated after surging over 7% Friday, with crude futures falling back below $72-73 per barrel
- Israel-Iran conflict entered fourth day with weekend strikes targeting energy infrastructure on both sides
- Federal Reserve meeting Wednesday remains key focus with only 3% chance of rate cut priced in
- Gold prices pulled back from record highs as investors regain appetite for risk
US stock futures staged a recovery Monday as concerns about the escalating Israel-Iran conflict began to ease. Markets are attempting to bounce back from Friday’s sharp selloff that saw the Dow plunge more than 700 points.
The conflict between Israel and Iran entered its fourth day over the weekend. Israel attacked command centers of Iran’s Revolutionary Guard and some oil facilities, while Iran’s retaliatory strikes early Monday killed four people.
Dow Jones Industrial Average futures rose 0.4% in premarket trading. S&P 500 futures gained 0.5%, while Nasdaq 100 futures climbed 0.6%.
Oil prices retreated after jumping dramatically on Friday. West Texas Intermediate crude futures fell over 1% to below $72 per barrel, while Brent crude dropped toward $73 per barrel.
The pullback in oil came after Friday’s 7.3% surge, which was the biggest one-day jump since March 2022. Crude had initially spiked over 6% Sunday evening before turning lower Monday.
Market Sentiment Shifts
President Trump offered some optimism about the situation Sunday. He said there’s a “good chance” of an Israel-Iran peace deal, though hostilities may need to play out first.
📈 The US futures are edging higher despite Israel-Iran missile strikes over the weekend.
🔹 S&P 500 $ES: +0.46%
🔹 Nasdaq $NQ: +0.49%🛢️ Crude Oil is down 6% from last week's high.
Are the markets factoring in a peace deal in the Middle East? 🤔#Trading #Markets… pic.twitter.com/gUwyz8HTRI
— Trader Edge (@Pro_Trader_Edge) June 16, 2025
Investors are regaining appetite for risk as hopes grow that the conflict won’t expand into a broader regional crisis. The measure of calm is returning despite Tehran’s hints it may close the Strait of Hormuz, a critical chokepoint for roughly one-fifth of the world’s oil.
Gold prices also pulled back from record highs reached Friday. Futures contracts for the precious metal fell 0.5% to around $3,440 per ounce as safe-haven demand cooled.
Bitcoin, which often trades alongside technology stocks, rose 1.3% in early trading. The 10-year Treasury yield nudged up to 4.463%, extending Friday’s advances.
Federal Reserve Decision Looms
The Federal Reserve will announce its interest rate decision Wednesday. Traders are pricing in just a 3% chance of a rate cut according to the CME Fedwatch tool.
Chair Jerome Powell’s comments on inflation outlook may provide insight into the Fed’s next moves. Rising oil prices could complicate the central bank’s path forward on inflation control.
Markets overwhelmingly expect the Fed to hold rates steady. President Trump has maintained pressure on Powell to cut rates, but current market dynamics may leave little room to move.
The Group of Seven nations meeting starts today in Canada. Investors hope the summit will provide a platform for trade deals as the grace period for Trump’s steep tariffs approaches expiration next month.
On the trade front, the EU is reportedly ready to accept US tariffs of 10% across all exports. The offer aims to avert higher rates on cars, drugs, and electronics as Trump pressures trading partners to reach deals.
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