US Futures Advance as President Trump Extends Truce With Iran

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(Bloomberg) — US stock-index futures advanced before the bell on Wednesday as traders examined the state of play for the Middle East following President Donald Trump indefinite ceasefire extension with Iran.

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Contracts for the S&P 500 Index gained 0.6% at 8:02 a.m. in New York, with the gauge looking to bounce after two-straight sessions of declines. Nasdaq 100 Index futures rose 0.8%, while Brent crude jumped 0.64% to $99 per barrel. The Cboe Volatility Index hovered around 19.

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“Mixed messages from Donald Trump, and an insistence that a US blockade of Iran will continue, mean investors are still playing a guessing game,” said Russ Mould, investment director at AJ Bell.

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Trump backtracked on threats to resume fighting on Tuesday afternoon after the two sides failed to meet for further peace talks. The president said Pakistan, which has been acting as a mediator in peace talks, asked the US to hold off on fresh strikes.

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While a return to fighting the war is not on the cards, there is still little sign the critical Strait of Hormuz will be reopened to oil and gas shipments soon. Iranian gunboats fired on two ships in the waterway on Wednesday.

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“Markets are still navigating a fragile balance between improving sentiment and lingering geopolitical risk,” said Daniela Hathorn, senior market analyst at Capital.com. “While ceasefire headlines and periodic reopenings of the Strait of Hormuz have helped ease immediate supply fears, disruptions to flows continue to linger, keeping a residual risk premium embedded in energy markets.”

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Investor focus will shift to corporate earnings, with Tesla Inc. delivering results after the bell. The automaker will be the first of the Magnificent Seven to report, and Wall Street will be seeking evidence that Elon Musk’s artificial intelligence and robotics ventures justify the stock’s sky-high valuation.

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Other names to report after the bell include Southwest Airlines Co., Lam Research Corp. and Texas Instruments Inc.

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In single-stock moves, United Airlines Holdings Inc. advanced following Trump’s extension of the ceasefire deal with Iran. The carrier reduced its adjusted earnings per share forecast for the year, though this was largely dismissed by analysts, who noted it was not too far off from consensus estimates.

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Boeing Co. gained after the company reported lower-than-expected cash outflow as it delivered the most aircraft in the first quarter since 2019. GE Vernova Inc. climbed after the power equipment company reported revenue for the first quarter that topped estimates.

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Sectors to Watch

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