Pre-Market Update: U.S. Stock Futures Rise as U.S.-Iran Ceasefire Revives Tech Rally

TLDR

• U.S. stock futures climbed Monday after the U.S. and Iran agreed to halt strikes and resume peace talks
• Nasdaq 100 futures rose over 1%, leading gains after a five-day losing streak last week
• The Magnificent Seven tech stocks have lost nearly $2.8 trillion in market cap this month
• Oil prices rose slightly but pared gains as investors weighed risks to Hormuz supply routes
• Key data this week includes the June jobs report on Thursday and Fed Chair Warsh’s first international appearance

U.S. stock futures rose sharply Monday morning after reports emerged that Washington and Tehran agreed to stop military strikes and resume peace negotiations.

Nasdaq 100 futures led the move, climbing more than 1%. S&P 500 futures gained around 0.8%, and Dow Jones futures were up roughly 0.4%.

The agreement came after a weekend of escalating tensions. The U.S. launched strikes on Iranian military targets after Washington said Iran carried out attacks along the Strait of Hormuz. President Trump warned further action was possible.

The two sides have now agreed to pause hostilities and continue peace talks that began after a memorandum of understanding was signed on June 17.

Oil prices ticked up early but gave back most of those gains. Brent crude was up 0.6% at $73 a barrel. West Texas Intermediate rose 0.9% to just under $70.

Analysts at ING noted that oil has not seen a big bounce despite the military exchanges. They said the key risk remains any actual disruption to oil flows through the Strait of Hormuz.

Tech Stocks Under Pressure

Tech stocks had a rough week heading into Monday. The Nasdaq Composite fell for five straight sessions — its longest losing streak since January.

Nvidia and Alphabet each dropped more than 8% last week. The broader Magnificent Seven group has now shed nearly $2.8 trillion in combined market cap this month, which would be a monthly record, according to FactSet.

The tech rebound in futures trading Monday suggests some investors are buying the dip. Whether that holds will depend on upcoming economic data.

What to Watch This Week

It is a holiday-shortened week, with U.S. markets closed Friday for the Fourth of July.

Thursday’s June jobs report from the Bureau of Labor Statistics will be the main event. The nonfarm payrolls data is closely watched by the Federal Reserve when making interest rate decisions.

Before that, the Job Openings and Labor Turnover Survey lands Tuesday. The ISM Manufacturing PMI follows on Wednesday.

New Fed Chair Kevin Warsh will make his first international appearance at the European Central Bank’s annual forum in Sintra, Portugal, running from June 29 to July 1. His comments on interest rates will be closely watched.

The 10-year U.S. Treasury yield stood at 4.382% early Monday, edging up slightly from the prior week.

Markets remain cautious heading into a week where geopolitical news and jobs data could move prices in either direction.

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