TLDR
- Equity futures advanced Tuesday following reports Trump may conclude Iran conflict without requiring Strait of Hormuz reopening
- Dow futures climbed 1%, S&P 500 futures advanced 0.9%, Nasdaq 100 futures increased 0.8%
- Major indices tracking toward weakest quarterly performance since 2022
- Crude oil maintained elevated levels, with WTI trading above $100 per barrel
- Market participants anticipate March consumer confidence figures and February JOLTS data
Equity futures in the United States experienced significant gains Tuesday morning following reports indicating President Trump’s potential willingness to conclude military operations in Iran without demanding complete reopening of the Strait of Hormuz.
Contracts linked to the Dow Jones Industrial Average surged approximately 459 points, representing a 1% increase. S&P 500 futures advanced 0.9% while Nasdaq 100 contracts climbed 0.8%.
The upward momentum materialized after The Wall Street Journal published a Monday evening report revealing that Trump and his advisors had determined that an operation to reopen the Strait of Hormuz would prolong the engagement beyond the administration’s desired timeline of four to six weeks.
In addition, Trump took to Truth Social Tuesday morning with messaging that appeared to indicate a potential conclusion to hostilities. “Iran has been, essentially, decimated,” his post stated. “The hard part is done. Go get your own oil!”
Henry Allen, a macro strategist at Deutsche Bank, commented that the Wall Street Journal’s reporting had “raised hopes that the current phase of the conflict will wind down soon,” noting that “the market tone has become decidedly more positive overnight.”
Tuesday marks the conclusion of first-quarter trading. According to Dow Jones Market Data, all three major benchmarks are headed toward their weakest quarterly performance since 2022.
The three indices declined Monday, surrendering earlier gains as market participants expressed concern regarding the continuing Middle East situation.
Market sentiment had deteriorated sharply entering Tuesday’s session. The CBOE Volatility Index exceeded 30 on Monday, indicating heightened investor apprehension.
Oil Stays High Despite Diplomatic Signals
Oil prices continued trading at elevated levels despite improved diplomatic indicators. West Texas Intermediate crude settled above $100 per barrel for the first time since 2022. During Tuesday’s morning session, WTI futures added another 0.4% to reach $103.28 per barrel. Brent crude held steady at $107.38.
Equities have faced difficulty sustaining rallies in recent weeks when crude prices remain elevated, which continues to concern market participants.
Gold futures increased 0.5% to $4,581 per ounce during early trading hours. The 10-year Treasury note yield decreased one basis point to 4.33%. The dollar remained unchanged against a basket of major global currencies.
Messaging from the administration has been inconsistent. While certain officials have highlighted diplomatic advancement, Trump separately raised the possibility of the US seizing Iranian oil resources.
Economic Data Due Tuesday
Market participants are monitoring incoming economic releases scheduled for later Tuesday. Both the March consumer confidence index and the February Job Openings and Labor Turnover Survey are expected. These publications should provide additional clarity regarding the US economy’s condition as the second quarter begins.
The US-Israeli military operation against Iran reached its fifth week as of Tuesday.
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