Wall Street Set for Strong Open as US-Iran Deal Sparks Global Risk Rally

U.S. stock futures showed positive movement. Dow Futures rose by 492.00 points, or 0.95%, to 52,097.00. S&P 500 futures gained 98.25 points, or 1.32%, to 7,533.25, while NASDAQ futures also trended higher, rising 646.25 points, or 2.16%, to 30,601.00.

Points to Know Before Market Opens

US stock futures climbed sharply on Monday after investors welcomed a preliminary agreement between the United States and Iran aimed at ending months of conflict and reopening the Strait of Hormuz. The prospect of easing geopolitical tensions boosted confidence across global markets, with futures linked to the Dow Jones Industrial Average rising more than 400 points, while S&P 500 and Nasdaq 100 futures also pointed to a robust start for Wall Street trading. Investors viewed the development as a positive signal for risk assets, although concerns remain over unresolved issues surrounding Iran's nuclear programme and broader regional tensions.

A sharp decline in crude oil prices emerged as another key market driver, with prices falling more than 4% following the announcement. The drop in oil prices shifted attention toward sectors that benefit from lower fuel costs, including airline and cruise operators, while energy producers could face pressure as the geopolitical premium embedded in crude prices begins to fade. Analysts, however, cautioned that oil could remain relatively elevated until shipping flows normalise fully and regional infrastructure disruptions are addressed.

The Federal Reserve now becomes the next major focus for investors. While easing oil prices may help reduce inflation concerns, markets largely expect policymakers to leave interest rates unchanged at this week's meeting. Attention will centre on Federal Reserve Chair Kevin Warsh's remarks and the latest economic projections for clues on the future path of monetary policy. Despite softer Treasury yields, traders continue to price in the possibility of another rate increase before the end of the year.

Corporate developments also contributed to the upbeat sentiment. SpaceX shares advanced in premarket trading after a strong Nasdaq debut, reinforcing optimism surrounding the market for high-profile public offerings and fuelling speculation over potential listings from other major technology firms later this year. Meanwhile, Paramount Skydance gained after receiving regulatory clearance for its acquisition of Warner Bros., adding another stock-specific catalyst to an already eventful session shaped by geopolitics, commodity moves, and expectations for central bank policy.

The 10-year Treasury yield decreased by 0.032 at 4.453%. The 2-year Treasury decreased by 0.036 points at 4.049%.