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U.S. stock index futures moved higher on Tuesday after comments from U.S. President Donald Trump suggesting the conflict with Iran could end soon helped ease investor concerns over prolonged geopolitical tensions and energy supply disruptions.
By 06:00 ET (10:00 GMT), Dow Jones futures rose 145 points, or 0.35%, while S&P 500 futures gained 17 points, or 0.3%, and Nasdaq 100 futures climbed 84 points, or 0.3%.
Trump signals possible end to conflict
Speaking at his golf club in Florida on Monday, Trump said he expected the war with Iran to end “very soon.” He also warned that the United States could intensify military operations if Iran attempts to block oil shipments through the Strait of Hormuz, a critical maritime route through which roughly 20% of global crude supply passes.
Trump added that Washington had even considered taking control of the strategic waterway to prevent disruptions to global oil markets, which have already experienced significant volatility due to the conflict.
Despite suggesting the conflict could end soon, Trump maintained a hardline tone, stating that the United States “could go further, and we’re going to go further.” He also warned that Iran’s new Supreme Leader Mojtaba Khamenei could be targeted if he refuses to comply with U.S. demands.
Mojtaba Khamenei, the son of former Supreme Leader Ali Khamenei, who was killed in U.S.-Israeli strikes earlier in the conflict, is widely viewed as likely to maintain Tehran’s hardline stance.
Iran rejects ceasefire prospects
Iranian officials responded by warning that no oil would be allowed to pass through the Strait of Hormuz if U.S. and Israeli attacks continue.
The country’s foreign minister reportedly dismissed the possibility of ceasefire negotiations with Washington, further highlighting the fragile nature of any potential de-escalation.
Meanwhile, Israeli Prime Minister Benjamin Netanyahu said the military campaign against Iran is “not done yet,” indicating that Israel intends to continue its efforts to dismantle the country’s ruling clerical leadership.
Fresh hostilities were reported on Tuesday, with Iran launching attacks toward Persian Gulf countries, while Israeli strikes targeted positions in Lebanon, including locations linked to the Iran-backed Hezbollah group.
Markets swing on geopolitical headlines
Financial markets have remained highly sensitive to developments in the conflict.
Wall Street experienced volatile trading on Monday as investors reacted to news that Mojtaba Khamenei had been appointed Iran’s new Supreme Leader, a move that initially raised fears the conflict could escalate and last longer than expected.
Oil prices surged to nearly $120 per barrel, approaching their highest levels since 2022, amid concerns about potential disruptions to shipments through the Strait of Hormuz.
At the same time, bond yields rose, reflecting investor worries that an energy-driven price surge could push global inflation higher and potentially force central banks to tighten monetary policy again.
However, sentiment shifted later in the session after Trump told CBS News that the conflict was “very complete, pretty much.” Following the remarks, U.S. stocks closed higher, oil prices retreated, and bond yields eased, highlighting how quickly market sentiment can change based on geopolitical developments.
