The ongoing conflict involving Iran and its impact on global oil prices remains the dominant theme for financial markets as the new trading week begins. However, investors will also be monitoring several other potential catalysts. Alongside developments in the Middle East, Nvidia (NASDAQ:NVDA) CEO Jensen Huang is scheduled to deliver a closely watched presentation on Monday, while memory-chip producer Micron (NASDAQ:MU) will release its latest earnings later in the week. Meanwhile, the Federal Reserve and the European Central Bank are both expected to announce policy decisions, with markets widely anticipating that interest rates will remain unchanged.
1. Iran conflict continues to dominate headlines
U.S. stock futures moved higher on Monday as the war involving Iran entered its third week, with U.S. President Donald Trump urging international partners to assist in reopening the closed Strait of Hormuz.
This narrow shipping channel south of Iran carries roughly one-fifth of global oil supplies and has become a critical focal point for the world economy. By effectively shutting down most tanker traffic through the strait, Tehran has disrupted energy flows and placed pressure on large economies—particularly those in Asia that rely heavily on imported fuel.
As a result, oil and gas prices have surged, raising fears that inflation could accelerate again and dampen global economic growth.
“The core problem at the heart of the Iran war from the perspective of markets remains unchanged: the U.S. and Israel are winning in the conventional military sense, but the Iranian regime is firmly entrenched in power, and Tehran is succeeding in holding the global economy hostage by closing Hormuz,” analysts at Vital Knowledge said in a note.
The spike in oil prices has created a particular challenge for Trump, whose joint military campaign with Israel against Iran shows little sign of slowing. Investors are increasingly speculating about Washington’s longer-term strategy and how the U.S. might eventually exit a conflict that has spread across much of the Middle East, including key oil-producing states in the Persian Gulf.
At home in the United States, the conflict is already having tangible economic effects. Gasoline prices have risen at the pump, and analysts suggest that sustained increases could influence voter sentiment ahead of the critical midterm elections scheduled for November.
2. Nvidia’s Huang to address developer conference
Attention in the technology sector will turn to Nvidia’s annual developer conference starting Monday, where CEO Jensen Huang is expected to outline the company’s strategy for maintaining its leadership in artificial intelligence.
Huang will appear at a time when Nvidia faces intensifying competition in the rapidly expanding market for AI-focused chips. Rivals such as Advanced Micro Devices and Intel are ramping up their efforts, while major technology companies—including Alphabet’s Google—are developing their own AI-optimized processors.
Another emerging challenge is the growing role of “inference” in artificial intelligence, which refers to AI systems performing tasks autonomously for users. These workloads often run on different types of processors than those traditionally produced by Nvidia, and some of the company’s largest clients—including OpenAI and Meta Platforms—have suggested they may develop their own chips tailored to these needs.
In December, Nvidia spent $17 billion to acquire Groq, a startup specializing in fast and cost-efficient inference processing. Last month, Huang said he would demonstrate how Groq’s technology can integrate with Nvidia’s CUDA platform.
The company has also invested around $2 billion in Lumentum and Coherent, two manufacturers of optical laser components that can transmit information between chips at extremely high speeds. Although these technologies could accelerate connections between Nvidia processors, they are not yet produced at the same scale as the company’s flagship chips.
“We expect Nvidia to announce a further broadened AI portfolio,” analysts at BofA Securities said in a note.
3. Micron earnings on deck
Another development related to the artificial intelligence theme will come later this week when memory-chip manufacturer Micron releases its latest quarterly results after markets close on Wednesday.
The U.S.-based company previously issued an optimistic forecast for adjusted profit in its second quarter in December, supported by elevated memory chip prices driven by ongoing supply constraints.
As large technology firms continue to invest heavily in expanding their AI capabilities, demand for advanced data centers—and the high-performance memory chips they require—has surged.
This trend could benefit Micron, whose memory products play a critical role in powering data center servers. The company guided for fiscal second-quarter adjusted earnings of $8.42 per share, plus or minus $0.20, nearly double the consensus forecast cited by Reuters.
Micron CEO Sanjay Mehrotra told investors last year that tight supply in the memory market could persist beyond 2026, noting that the company may only be able to meet between half and two-thirds of demand from several key customers.
4. Federal Reserve policy decision
Beyond the technology sector, investors are also preparing for a series of interest rate decisions from central banks around the world.
The Federal Reserve will take center stage, with policymakers widely expected to leave borrowing costs unchanged when their two-day meeting concludes on Wednesday.
Fed Chair Jerome Powell—who is expected to step down from his role in May—will likely use one of his final press conferences following a policy decision to comment on the health of the U.S. labor market and the outlook for inflation.
Recent employment figures have come in significantly weaker than expected, highlighting potential fragility in the job market. At the same time, inflation risks could increase due to rising energy prices linked to the Iran conflict.
These factors place the Fed in a difficult position. Lowering rates could support job growth but risk fueling inflation, while raising rates could curb price pressures but potentially weaken employment conditions.
Markets will be watching closely for signals about how the central bank plans to balance these competing risks in the months ahead.
5. European Central Bank decision approaching
In Europe, the shutdown of shipping through the Strait of Hormuz threatens to reignite inflation in a region that had only recently appeared to bring price pressures under control.
The continent relies heavily on imported energy passing through the strait, and disruptions could place additional strain on an economy that has already shown signs of stagnation.
As oil and gas prices have risen, borrowing costs across Europe have also increased, partly reflecting concerns that the European Central Bank might eventually need to reconsider raising interest rates. The Stoxx 600 index has come under pressure, falling more than 5% from its peak prior to the conflict.
The ECB, along with several other major central banks including the Federal Reserve, will announce its latest monetary policy decision later this week. Despite ongoing tensions in the Middle East, economists expect the ECB to keep interest rates unchanged throughout the remainder of 2026, according to a Reuters poll.
“Central banks are not expected to make major changes to monetary policy this month, but watch closely for how the Fed and others assess the inflation outlook after the surge in oil prices,” Laurence Booth, Global Head of Markets at CMC Markets, said.