U.S. stock futures tied to the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite were pointing to a higher open on Tuesday, suggesting Wall Street may build on the momentum seen in the previous trading session.
Investor optimism appears to be fueled by geopolitical developments, following former President Donald Trump’s announcement of a ceasefire agreement between Israel and Iran, which helped lift sentiment across global markets.
“On the assumption that everything works as it should, which it will, I would like to congratulate both countries, Israel and Iran, on having the stamina, courage, and intelligence to end what should be called ‘THE 12-DAY WAR,’” Trump said on Truth Social.
Although tensions haven’t completely subsided—Israel has already accused Iran of breaching the truce—market participants appear hopeful that this signals a step toward regional de-escalation.
The positive tone in futures trading held steady even after Federal Reserve Chair Jerome Powell emphasized the Fed’s current inclination to hold interest rates steady, despite ongoing pressure from Trump to ease monetary policy.
“For the time being, we are well positioned to wait to learn more about the likely course of the economy before considering any adjustments to our policy stance,” Powell stated during his testimony to the House Financial Services Committee.
On Monday, after a hesitant start, investors pushed stocks higher during the latter part of the session. All three major indices ended the day with solid gains.
The Dow rose by 374.96 points, or 0.9%, closing at 42,581.78. The Nasdaq climbed 183.56 points, or 0.9%, to settle at 19,630.97, while the S&P 500 advanced 57.33 points, or 1.0%, to end the day at 6,025.17.
Earlier in the day, markets had traded mostly flat as traders waited to gauge Iran’s response to recent U.S. airstrikes targeting Iranian nuclear facilities over the weekend.
Concerns briefly resurfaced mid-session after headlines hinted at Iran considering a blockade of the Strait of Hormuz, a crucial oil transit route. Additionally, reports of a possible Iranian strike on a U.S. base in Qatar added to market jitters.
Despite those setbacks, a late-session rally was triggered after Federal Reserve Vice Chair Michelle Bowman hinted at the possibility of a rate cut in July, citing labor market weaknesses and signs of softening inflation driven by reduced tariff pressures.
Reports indicating that the U.S. and China might scale back certain tariffs also helped soothe investor concerns.
The major indices saw identical performance numbers at the close as mentioned earlier, with the Dow up 374.96 points, the Nasdaq up 183.56 points, and the S&P 500 gaining 57.33 points.
In housing data, the National Association of Realtors reported that existing home sales edged up by 0.8% in May, while inventory levels rose by 6.2%. However, on an annual basis, sales were still 0.7% lower than a year ago.