U.S. stock futures rallied Sunday night and oil prices fell after the U.S. and Iran paused their attacks over the weekend. The move opens a week carrying a Federal Reserve rate decision and quarterly reports from Amazon, Apple, Meta Platforms and Microsoft.
Dow Jones Industrial Average futures rose by 244 points, or 0.5% on Sunday night. S&P 500 futures gained 0.6%, while Nasdaq 100 futures advanced 1.2%.
That rally follows another losing week for U.S. equities, as a pullback in chip stocks and uncertainty over the war with Iran weighed on investors. The Dow fell for the third consecutive week. The S&P 500 and the Nasdaq Composite both declined for the second week in a row.
Oil drops as Iran suspends attacks
Brent crude futures fell more than 5% to around $92 a barrel. U.S. West Texas Intermediate crude futures dropped 5% to roughly $85 a barrel.
Prices slid after Iran said it will suspend attacks so long as a U.S. pause on fighting also holds, following nearly two weeks of escalating attacks. Iranian officials met with Omani mediators over the weekend, and the U.S. apparently has not attacked Iran since Friday night after 13 days of strikes.
Fed decision and megacap earnings ahead
The Fed will make its latest decision on interest rates on Wednesday. The consensus view is that the central bank will hike in September, but markets are pricing in the meaningful possibility that it lifts its benchmark borrowing rate a quarter percentage point as soon as this week, according to the CME FedWatch Tool.
CME’s FedWatch tool gave a 38% chance of a rate hike this week, MarketWatch reported, though most experts believe a hike is more likely in September.
Quarterly reports from Amazon, Apple, Meta Platforms and Microsoft will either soothe investor fears of rampant artificial intelligence spending, or add to them, after Alphabet’s disappointing results in the last week. According to CNBC, Ken Mahoney, CEO of Mahoney Asset Management, said: “The biggest risk is the continuation of the spend”.
The Nasdaq closed just below its early June lows last week, and the S&P 500 sits below its 50-day line.
Sources: CNBC, MarketWatch, Investor’s Business Daily
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