Jeenah Moon | Reuters
Dow Jones Industrial Average futures rose by 129 points, or 0.25%. S&P 500 futures and Nasdaq-100 futures climbed 0.23% and 0.27%, respectively.
Those moves come after the latest escalation in hostilities in the Middle East over the weekend. Iran-backed Houthis said they attacked Saudi Arabia with missiles and drones on Saturday. Later in the day, the U.S. State Department warned Americans to reconsider traveling to the Middle East as the U.S. and Iran traded threats to resume attacks.
Investors are coming off their third consecutive week of losses for the Dow, which slid 1.7% for its worst performance since March. The S&P 500 was off about 0.1%. Only the tech-heavy Nasdaq posted a gain, up 0.7%.
The pullback in the Dow comes after the Federal Reserve hiked interest rates last week for the first time in three years, as the U.S. struggles with taming sticky inflation and elevated bond yields. Oil prices remain near $100 a barrel. The 10-year Treasury yield is also hovering close to 5%.
That could heighten the significance of a key summit this week between U.S. President Donald Trump and Chinese President Xi Jinping, which will cover tariffs, critical minerals, and artificial intelligence and other economic issues. Treasury Secretary Scott Bessent is meeting with Chinese Vice Premier He Lifeng ahead of the visit.
“The same geopolitical conflict inflating energy prices is also what’s keeping the [Federal Reserve] hawkish and what’s squeezing Chinese refiners,” wrote Jeffrey Roach, chief economist at LPL Financial. “[Fed Chairman] Warsh’s committee has conditioned its inflation outlook on oil markets settling down, and Beijing’s fiscal calculus runs through the same variable.”
About the Author
