Key Takeaways

• Futures advance: Dow futures rose 129 points (+0.3%), S&P 500 futures gained 0.4%, and Nasdaq 100 futures climbed 0.7%.
• Prior session mixed: The Dow edged down while the S&P 500 and Nasdaq 100 both advanced as chip stocks bounced from Broadcom’s selloff.
• AI sentiment stabilizes: Chipmaking stocks rebounded after Friday’s Broadcom-driven selloff.
• Trump: “Final throes” of Iran deal: The White House suggested a peace agreement could be forged within days.
• Vital Knowledge’s take: Once a deal is signed, “there will be a swift move lower in yields and oil even if Hormuz conditions don’t fully normalize for a long time.”
• Hormuz reopening on the table: Trump said the Strait would open once a deal is signed.
• “Total victory” in two weeks: Trump told a virtual rally the U.S. had “decimated” Iran’s military and would declare total victory soon.
• “Oil prices will come tumbling down”: Trump’s optimistic prediction for crude markets.
• Brent slips 2.3%: The global benchmark fell to $92.10 per barrel, soothing immediate inflation fears.
• Treasury yields near flat: 10-year yields hovered around flat; the 2-year dipped marginally — both still above pre-war levels.
• CPI Wednesday the main event: May’s consumer price index will shape Fed rate expectations.
• Fed rate hike now expected: Markets are pricing at least one increase this year on energy inflation and jobs strength.
• Today’s calendar: U.S. trade data for April and existing home sales for May.
• Nuvalent soars: Shares spiked premarket after GlaxoSmithKline agreed to acquire the cancer drugmaker for $10.6 billion.
• Vail Resorts sinks: The ski resort operator slashed its full-year outlook after low snowfall weighed on visits.

Futures linked to the main U.S. stock indices pointed higher on Tuesday, as investors were comforted by stabilizing sentiment around the artificial intelligence boom and easing tensions in the Middle East.

By 05:10 ET (09:10 GMT), the Dow futures contract had risen by 129 points, or 0.3%, S&P 500 futures had gained 30 points, or 0.4%, and Nasdaq 100 futures had gained 207 points, or 0.7%.

The main averages on Wall Street were mixed in the prior session, with the blue-chip Dow Jones Industrial Average edging down while the benchmark S&P 500 and tech-heavy Nasdaq 100 both advanced.

Underpinning the gain in the Nasdaq were chipmaking stocks, which rebounded from a sell-off on Friday brought on by underwhelming quarterly results from AI semiconductor firm Broadcom.

On the economic calendar today, traders will be pouring through U.S. trade data for April as well as existing home sales for May. But the main event this week is still to come: the all-important consumer price index for May is due out on Wednesday.

Crucially, the CPI report will likely provide some insight into how Federal Reserve policymakers will adjust monetary policy in the coming months. Markets are now betting that the Fed will raise interest rates at least once this year, given worries over energy-driven inflation and signs of a robust labor market.

Benchmark U.S. 10-year government bond yields were last hovering around the flatline, yet continue to top levels seen before the outbreak of the war in late February. The rate-sensitive 2-year yield dipped marginally.

Trump Says U.S. in “Final Throes” of Iran Deal

The bond moves come as Brent crude futures, the global oil benchmark, slipped 2.3% to $92.10 a barrel. Despite remaining well above pre-war levels, the decline soothed some immediate fears over a burst of inflationary pressure.

Analysts at Vital Knowledge flagged that the White House has suggested a deal to end the more than three-month-old war in Iran could be forged within days. Once a formal agreement is notched, “there will be a swift move lower in yields and oil even if Hormuz conditions don’t fully normalize for a long time,” they added.

Markets have been especially keen for U.S. President Donald Trump to make a deal which would reopen the Strait of Hormuz — a critical waterway for a fifth of the world’s oil that has been effectively shuttered to tanker traffic for months, blocking key supplies to countries around the world and elevating oil prices.

Trump said on Monday evening that the U.S. was close to reaching a peace deal with Iran, adding that the Strait of Hormuz would be open once it is signed. Speaking during a virtual rally, Trump also claimed that the U.S. had “decimated” Iran’s military and top leadership.

“I think we are winning that battle, but you’re really gonna win it over the next two weeks when we declare total victory,” Trump said. “It’ll happen very soon and oil prices will come tumbling down.”

Individual Stock Movers

Shares of Nuvalent soared before the opening bell after GlaxoSmithKline agreed to buy the cancer drugmaker for $10.6 billion.

Vail Resorts shares, on the other hand, declined after the firm slashed its full-year outlook. Low snowfall has weighed on visits to the company’s ski resorts.