US stock futures are indicating a negative start to Monday’s session, April 20, after a turbulent weekend in the Middle East cast doubt on prospects for peace talks ahead of a looming ceasefire deadline.
Futures for the three key indices — the Dow Jones Industrial Average, the S&P 500, and the Nasdaq — were down between 0.4% and 0.5%. The risk-off mood is weighing on a recent rally that had erased all war-driven losses in US equities.
The US Navy reportedly carried out its first seizure of an Iranian vessel in the Strait of Hormuz, reigniting tensions in the region.
Iran’s joint military command repo said Tehran would respond soon, termed the US action an act of piracy, and abruptly halted traffic through the waterway less than 24 hours after saying ships could pass, renewing doubts about how soon vessels will be able to transport the vast amounts of oil the world receives from the Middle East.
Iran also reportedly said on Monday that it has no immediate plans to attend talks with the United States, with the truce set to expire shortly.
Both the S&P 500 and Nasdaq had hit multiple record highs last week after Iran announced the reopening of the Strait of Hormuz to commercial vessels. Trump had also suggested that the conflict could end soon and indicated openness to extending the two-week ceasefire, helping both indices rally more than 12% from their late-March lows.
The S&P 500 on Friday capped a third straight week of gains of over 3% and is on track for its biggest monthly advance since 2020.
Since the index hit its 2026 low on March 30, the technology sector has moved from being the worst-performing group in the benchmark to the best. An index tracking the so-called Magnificent Seven technology giants has surged 20% over the same period, reversing a 17% decline from its October peak.
While the situation in the Middle East remains fluid, traders will also focus this week on Kevin Warsh’s Senate confirmation hearing for the role of Federal Reserve Chair.
Crude oil prices rebound after two straight weeks of losses
Crude oil prices rebounded in trade as traders turned cautious amid renewed geopolitical tensions in the Middle East.
The US benchmark crude rose 7% to $89.71 a barrel, while Brent crude, the international benchmark, gained 8% to $97.50 a barrel, reversing some of the losses from the previous session.
The recovery comes after crude prices logged two consecutive weeks of losses, which had pulled prices back to levels seen in the early days of the Iran conflict on Friday.
With the two-week ceasefire set to expire on Tuesday, focus is shifting to whether the US and Iran can resume negotiations to ease tensions and reopen the key waterway, after initial talks in Islamabad failed.
Stocks and sectors in focus today
Vested Finance said oil’s surge is weighing on fuel-sensitive sectors, with American Airlines trading lower as higher crude prices raise concerns over operating costs. Even within energy, the trend is uneven, it noted, as APA Corporation is declining despite the broader tailwind.
It added that Chevron and ExxonMobil are trading higher in premarket, while deal-driven momentum is also visible, with TopBuild surging after a $17 billion acquisitio by QXO.
The brokerage further highlighted that AI-linked optimism is offering pockets of resilience, with Marvell Technology gaining on expectations of deeper involvement in AI infrastructure, highlighting how the AI trade continues to attract capital even during broader risk-off sessions.
On the downside, Vested Finance pointed out that event-driven losses remain sharp, with AST SpaceMobile falling after a failed satellite deployment, while Netflix is among the notable laggards in premarket trading, reflecting broader weakness in growth stocks as yields edge higher.
(With inputs from Bloomberg)
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