U.S. stock futures are indicating a higher open on Friday, suggesting that markets may build on the upward momentum seen in recent sessions.
Investor sentiment continues to be supported by optimism that the U.S. conflict with Iran could be nearing an end, following recent remarks from President Donald Trump.
Speaking at an event in Las Vegas on Thursday, Trump said the “war in Iran is going along swimmingly” and “should be ending pretty soon.”
While similar upbeat comments have been made throughout the conflict, they continue to underpin positive sentiment in equity markets.
“If a resolution can be found in the near term, then perhaps the market will have been right to see this as a blip rather than something which justifies a more significant derating of corporate valuations,” said Russ Mould.
He added, “Only time will tell, though sooner rather than later there will need to be evidence of Donald Trump’s repeated claims that the war will be ending soon coming to fruition.”
Markets are also being supported by expectations of solid corporate earnings, ahead of a busy week of results from major companies.
Among those set to report are 3M (NYSE:MMM), UnitedHealth (NYSE:UNH), AT&T (NYSE:T), Boeing (NYSE:BA), IBM Corp. (NYSE:IBM), Tesla (NASDAQ:TSLA), American Express (NYSE:AXP), and Intel (NASDAQ:INTC).
However, Netflix (NASDAQ:NFLX) shares are down 8.9% in premarket trading after the company delivered strong first-quarter results but issued weaker-than-expected guidance for the second quarter.
On Thursday, stocks traded unevenly but maintained an overall positive tone, with major indices ending moderately higher. The Nasdaq and S&P 500 both extended recent gains, closing at fresh record highs.
All three major benchmarks finished in positive territory: the Nasdaq rose 86.69 points, or 0.4%, to 24,102.70; the S&P 500 gained 18.33 points, or 0.3%, to 7,041.28; and the Dow Jones Industrial Average added 115.00 points, or 0.2%, to 48,578.72.
The sustained rally has helped the Nasdaq and S&P 500 recover fully from the sharp declines seen following the outbreak of the U.S.-Iran conflict.
Investors also remain hopeful about the possibility of renewed peace talks between Washington and Tehran, although no official meeting has yet been confirmed.
Reports suggest both sides may consider extending the current ceasefire by two weeks to allow more time for negotiations.
Further boosting sentiment, Trump said in a post on Truth Social that Israel and Lebanon have agreed to a 10-day ceasefire.
He also noted that Israeli Prime Minister Benjamin Netanyahu and Lebanese President Joseph Aoun have been invited to the White House for peace discussions.
Iran has continued to insist that Israel halt its attacks on Hezbollah in Lebanon as part of any ongoing ceasefire agreement.
“It’s like the events of the past month-and-a-half have been placed in the rearview mirror by investors,” said Dan Coatsworth. “The market’s sanguine perspective may be tested if the rhetoric about an end to the fighting isn’t matched by reality sooner rather than later.”
On the economic front, the Federal Reserve reported that U.S. industrial production unexpectedly declined in March.
Industrial output fell 0.5% during the month, following a 0.7% increase in February. Economists had expected a modest 0.1% rise. The decline was partly driven by notable drops in utilities and mining production.
In sector performance, transportation stocks stood out, pushing the Dow Jones Transportation Average up 4.1% to a record closing high.
J.B. Hunt (NASDAQ:JBHT) was a key contributor, with shares jumping 6.3% after reporting better-than-expected quarterly results.
Telecom stocks also showed strong gains, with the NYSE Arca North American Telecom Index rising 3.8%.
Strength was also seen in networking, hardware, software, and oil-related stocks, while airline stocks moved notably lower.