- Dow Jones futures rise as hopes grow that Trump may end the Iran conflict.
- Market Sentiment improved after Fed’s Powell said long-term US inflation expectations remain anchored.
- Art Hogan of B. Riley Wealth Management says the 10% declines are a typical correction.
Dow Jones futures rise, up by 0.81%, above 45,800 during European hours, ahead of the United States (US) regular market open on Tuesday. Meanwhile, S&P 500 and Nasdaq 100 futures advance 0.78% and 0.54% to near 6,440 and 23,260, respectively, at the time of writing.
US stock futures advanced as easing risk aversion and lower oil prices lifted market sentiment, driven by rising expectations that US President Donald Trump could bring the Iran conflict to an end. The Wall Street Journal reported that Trump indicated to aides he may stop the campaign even if the Strait of Hormuz remains largely closed. However, analysts consider the recent oil price decline a short-lived response, emphasizing that any sustained drop would require a full restoration of shipping flows through the strait.
Meanwhile, market sentiment improved following dovish remarks from Federal Reserve (Fed) Chair Jerome Powell, who reiterated that long-term US inflation expectations remain well anchored despite escalating Middle East tensions. Powell also stressed that the Fed’s current policy setting gives policymakers room to evaluate the broader economic effects of the Iran conflict.
During Monday’s regular US session, the Dow Jones edged up 0.11%, while the S&P 500 and Nasdaq 100 fell 0.39% and 0.73%, respectively. The S&P 500 is now down just over 9% from its recent closing peak, largely due to weakness in technology stocks, which dropped more than 1%. Art Hogan of B. Riley Wealth Management noted that the pullback appears to be a typical market correction rather than an unusual development, adding that declines of around 10% are common in longer-term market cycles, reported by CNBC.
