The major U.S. index futures on the Dow Jones, S&P and Nasdaq are currently pointing to a higher open on Monday, with stocks likely to regain ground following the sell-off seen last Friday.
Traders may look to pick up stocks at somewhat reduced levels following the previous session’s nosedive, which came after Israel launched a series of airstrikes against Iran.
While the clash between Israel and Iran continued over the weekend, traders appear optimistic the conflict will remain relatively contained.
“Despite a weekend of violence between the two countries, investors showed no signs of panicking, judging by movements in financial markets on Monday,” said Russ Mould, investment director at AJ Bell.
However, he added, “The Middle East conflict remains a fluid situation and there is the potential for markets to still experience sudden jolts if the tension escalates further.”
The upward momentum on Wall Street also comes as traders look ahead to a meeting of major world leaders at the G7 summit in the Canadian Rockies later this week.
Traders will be looking to the meeting for signs of progress on trade deals ahead of the end of President Donald Trump’s 90-day pause on “reciprocal tariffs” early next month.
The Federal Reserve’s latest monetary policy announcement is also likely to attract attention from traders in the coming days.
While the central bank is widely expected to leave interest rates unchanged, the accompanying statement and Fed officials’ latest projections may provide more clarity about the outlook for rates.
After moving modestly higher over the course of the Thursday’s session, stocks pulled back sharply during trading on Friday. The major averages all moved significantly lower, with the Dow and the S&P 500 pulling back well off Thursday’s three-month closing highs.
The major averages staged a recovery attempt in late morning trading after an early slump but moved back to the downside as the day progressed.
The Dow plummeted 769.83 points or 1.8 percent to 42,197.79, the Nasdaq plunged 255.66 points or 1.3 percent to 19,406.83 and the S&P 500 tumbled 68.29 points or 1.1 percent to 5,976.97.
With the steep drop on the day, the major averages also moved lower for the week. The Dow slumped by 1.3 percent, the Nasdaq slid by 0.6 percent and the S&P 500 fell by 0.4 percent.
The sell-off on Wall Street came amid geopolitical concerns after Israel launched a series of airstrikes against Iran earlier this morning.
The Israeli airstrikes targeting nuclear facilities and ballistic missile factories killed at least three of Iran’s senior military leaders.
Iran retaliated by launching more than 100 drones toward Israeli territory, which the Israel Defense Forces said they are working to intercept.
The attacks led the worries about a wider conflict, and the price of crude oil spiked amid concerns about supply disruptions.
Responding to the news in a post on Truth Social, President Donald Trump urged Iran to reach a nuclear agreement before an escalation of the attacks.
“There has already been great death and destruction, but there is still time to make this slaughter, with the next already planned attacks being even more brutal, come to an end,” Trump said.
“Iran must make a deal, before there is nothing left, and save what was once known as the Iranian Empire,” he added. “No more death, no more destruction, JUST DO IT, BEFORE IT IS TOO LATE.”
Meanwhile, traders largely shrugged off a report from the University of Michigan showing a substantial improvement by consumer sentiment in the month of June.
The University of Michigan said its consumer sentiment index surged to 60.5 in June after holding at 52.2 in May. Economists had expected the index to rise to 53.5.
Airline stocks turned in some of the market’s worst performances on the day, dragging the NYSE Arca Airline Index down by 4.3 percent to its lowest closing level in over a month.
Substantial weakness was also visible among computer hardware and semiconductor stocks, with the NYSE Arca Computer Hardware and Philadelphia Semiconductor Index plunging by 2.7 percent and 2.6 percent, respectively.
Housing, networking and financial stocks also saw considerable weakness on the day, while energy and gold stocks bucked the downtrend.
Dow Jones, S&P, Nasdaq, Futures Pointing To Initial Rebound On Wall Street
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