S&P 500 futures edge lower while Nasdaq futures slide 0.5%
S&P 500 and Nasdaq futures edged lower on Monday, with the Nasdaq declining by 0.5%, as investors digested the start of the busiest week of the corporate earnings season and regional tensions in the Middle East. The broader market indexes had closed near session lows the previous week, with the tech-focused Nasdaq Composite falling after a sharp decline in chip stocks. Meanwhile, the blue-chip Dow Jones Industrial Average had risen, and the S&P 500 had edged higher.
Oil prices tumbled amid reports that Iran would pause military attacks if the U.S. continued its own pause, following a statement from President Donald Trump that he had called off an escalation. U.S. benchmark West Texas Intermediate futures fell 8% to $82.30 a barrel, while Brent crude futures dropped 9.4%. The developments led to declines in energy stocks, with Chevron and Exxon Mobil falling.
Investors will be closely watching the earnings reports from major companies, including Meta Platforms and Microsoft on Wednesday and Amazon and Apple on Thursday. The market is also anticipating the public debut of Elon Musk's SpaceX on Friday, which is expected to be largest initial public offerings.
Semiconductor stocks showed signs of recovery, with the iShares Semiconductor ETF rebounding 3% after a 4.5% decline on Friday. The Philadelphia Semiconductor Index was up 61% compared to the S&P 500's 13% gain for the quarter. Analysts noted that AI infrastructure is a key driver of demand for semiconductors, with earnings per share expected to increase by 12% in 2027.
The 10-year Treasury yield, which influences interest rates on consumer loans, including mortgages, fell nearly five basis points from Friday’s close to 4.64%. Traders are pricing in a 32% likelihood of a Federal Reserve rate hike at its meeting this week, up from about 16% one week ago. The probability of at least a quarter-percentage-point rate hike at September stands at 77%, up from 64% a week ago.
Bitcoin traded around $65,200, showing modest gains over the past 24 hours. The U.S. dollar index, which measures the value of the greenback against a basket of foreign currencies, was down 0.2% at 101.27. Gold futures rose 0.7% to $4,100 an ounce.
