Market Overview
On Monday night, S&P 500 futures were moving sideways after a rebound in major market averages, which benefited from a decline in oil prices.
The S&P 500 saw a slight dip of 0.1%, while Nasdaq 100 futures dropped nearly 0.2%. Additionally, futures related to the Dow Jones Industrial Average decreased by 47 points, or 0.1%.
Earlier in regular trading, major averages had bounced back, fueled by a pause in crude oil price increases. The S&P 500 climbed 1% following a tough previous week, when market indexes had plummeted to their lowest point of the year amidst escalating tensions between the U.S. and Iran. The Dow rallied about 388 points (0.8%), and the tech-heavy Nasdaq Composite Index surged 1.2%.
All 11 sectors of the S&P ended the day on a positive note, particularly buoyed by technology stocks. Notably, NVIDIA shares increased by about 1.7% after CEO Jensen Huang projected substantial orders for the company’s new systems could hit $1 trillion by 2027 during their annual conference.
The drop in oil prices on Monday helped improve sentiment towards U.S. stocks. Brent crude oil fell about 2.8% to settle at $100.21 a barrel, while West Texas Intermediate crude dipped around 5.3% to close at $93.50.
Oil prices had surged recently due to concerns over potential disruptions to global energy supplies following U.S. and Israeli military actions against Iran. Treasury Secretary Scott Bessent stated that Iranian oil tankers were being permitted to pass through the critical Strait of Hormuz. However, President Trump mentioned that a coalition to safeguard these tankers has not yet materialized.
Investors continue to monitor the ongoing situation in the war. Some link the stock market’s recent strength to a resilient economy, low inflation, and robust earnings. Yet, Holly Mazzocca, president of Bartlett Wealth Management, pointed out that “risks to that growth narrative are mounting.”
She elaborated, “We started the year in a strong position, but the labor market is showing signs of weakening. So, the pressing issue for investors is to realistically assess the risks to ongoing growth, which seem higher now than just a few weeks ago,” she said on CNBC’s “Closing Bell.”
Looking ahead, companies like Lululemon, DocuSign, and Oklo are set to release their earnings results on Tuesday.
In another development, investors are also awaiting the Federal Reserve’s second interest rate decision this year, scheduled for Wednesday. According to CME Group, hopes for interest rate cuts have diminished as inflation worries have picked up since the Iran conflict began.
