US stock futures surged early Monday as traders welcomed the pause in Middle East fighting just as one of the busiest earnings weeks of the year gets underway.
Dow futures gained about one percent, the S&P 500 added nearly one percent, and Nasdaq 100 futures jumped roughly one point four percent.
The rally follows a rough stretch last week that had dragged major indexes lower on conflict fears and shaky earnings commentary from one megacap name. Oil’s slide over the weekend is also expected to take some pressure off inflation readings due later this week.
An Iranian official again signaled Tehran would halt operations entirely if the US holds its side of the pause, with the message reportedly already relayed to Washington. Asian markets rallied overnight on the same optimism, helped by a blockbuster Shanghai listing that saw one Chinese chipmaker’s shares soar more than four hundred percent on debut after an eight billion dollar raise.
This week brings some of the most closely watched results of the year, with Amazon, Meta, and Microsoft reporting Wednesday and Thursday, and Apple and Qualcomm due shortly after.
Investors are still nursing losses from the prior week, when one major tech name’s heavy AI spending and negative free cash flow spooked the market and dragged a popular basket of megacap stocks down more than five percent, even as chip stocks moved higher.
Traders describe a market split down the middle right now, nervous that the big AI spenders are burning cash on data centers while semiconductor makers get rewarded instead. Prediction markets are leaning heavily toward a higher open Monday as crude keeps falling.
A Federal Reserve decision later this week adds another wildcard, and any flare up in Middle East tensions could quickly reverse the mood.
