U.S. stock futures rose Monday after President Donald Trump called off planned strikes against Iran and said diplomatic talks between the two countries would resume, sending oil prices lower on the first trading day of August.
Oil prices fell sharply on news that talks between the U.S. and Iran would resume Monday, pulling Treasury yields lower too
Michael Nagle / Bloomberg via Getty Images
U.S. stock futures rose Monday after President Donald Trump called off planned strikes against Iran and said diplomatic talks between the two countries would resume, sending oil prices lower on the first trading day of August.
The Dow Jones Industrial Average futures were up roughly 610 points, equivalent to about 1.2%. S&P 500 futures rose 0.6%, while Nasdaq $NDAQ-100 futures edged up 0.2%.
Crude oil prices fell on the news. Brent crude tumbled roughly 6% to $82.95 a barrel, and West Texas Intermediate fell close to 7%, settling at $78.93 a barrel. The benchmark 10-year Treasury yield declined 7 basis points to approximately 4.67% as some inflation anxiety receded.
On Sunday, Trump announced he had called off a strike on Iran and signaled that diplomatic engagement would restart. CNBC reported that Friday news accounts had described the president readying another round of military action after prospects for a deal had faded and oil prices spiked.
The Wall Street Journal noted that the prospect of a Strait of Hormuz agreement weighed on crude prices, while also observing that the back-and-forth between military posturing and diplomacy has grown predictable and has so far yielded little.
Vital Knowledge founder Adam Crisafulli cautioned that "investors are keeping their enthusiasm in check as 'we've been here before' and it's likely the conflict has further to go before reaching a resolution (if it ever does)," according to CNBC.
European equities posted gains, with the pan-regional Stoxx 600 advancing 0.3% and Germany's DAX up 1.3%. France's CAC 40 climbed about 1.1%, whereas the U.K.'s FTSE 100 edged down 0.1%. Across Asia-Pacific, results were uneven: South Korea's Kospi gave back more than 5% of Friday's record-breaking rally, Japan's Nikkei 225 retreated 0.94%, and Australia's S&P/ASX 200 finished 0.47% in the green.
The moves come after a volatile July for U.S. equities. The week also brings a series of employment reports, capped by Friday's release of July payrolls and the monthly unemployment rate. Economists polled by FactSet forecast the economy created 87,500 jobs in July, compared with 57,000 in June, with the jobless rate projected to tick up a tenth of a point to 4.3%.
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