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US stock futures jumped on Thursday, with techs pacing gains as investors digested the signing of the interim US-Iran peace deal and the latest Federal Reserve decision on interest rates.
Contracts on the tech-heavy Nasdaq 100 (NQ=F) surged roughly 1.4%, while those on the S&P 500 (ES=F) moved up 0.8%. Meanwhile, Dow Jones Industrial Average futures (YM=F) rose 0.6%, coming off sharp closing losses for Wall Street stocks.
President Trump and his Iranian counterpart on Wednesday signed the memo outlining their countries’ peace agreement, a move previously expected on Friday. The deal went into effect on Thursday, potentially speeding up the timeline for reopening the Strait of Hormuz to commercial traffic and lifting sanctions on Iranian oil. Negotiations on more protracted issues, including Tehran’s nuclear program, are expected to take place over the next 60 days.
Meanwhile, investors eyed the chances that rates will stay higher for longer after more Fed officials signaled a hike is on the table for later this year, after standing pat on policy in their decision on Wednesday. The central bank’s hawkish tilt comes as inflation has remained elevated and the job market steady amid conflict with Iran.
Thursday will be the last day of trading for Wall Street stock markets, which will close on Friday to observe the Juneteenth holiday.
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Asian markets continue rally spurred by US-Iran peace deal
Reuters reports:
Shares surged Thursday in Asia, with benchmarks in Japan and South Korea setting fresh records, after the U.S. and Iran signed their initial agreement ending the war.
The rally in Asia followed a retreat Wednesday on Wall Street driven by speculation the Federal Reserve may raise interest rates this year to curb inflation.
In Tokyo, the Nikkei 225 (^N225) kept on surging, gaining 1.9% to 71,233.35. It topped 70,000 for the first time this week and is still gaining thanks to hopes for an end to the war and buying of high-tech shares due to the artificial intelligence boom.
South Korea’s Kospi (^KS11) likewise has been setting records, gaining 0.6% to 8,917.31. Taiwan’s Taiex jumped 1%.
In Hong Kong, the Hang Seng (^HSI) lost 1.4% to 23,968.66, while the Shanghai Composite index edged 0.1% higher.
Australia’s S&P/ASX 200 (^AXJO) slipped 0.4% to 8,930.50.
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Gold rises amid Iran war peace deal and stationary Fed rates
Bloomberg reports:
Gold (GC=F) rose, supported by the signing of an interim peace deal between the US and Iran, even as the Federal Reserve signaled a rate hike later in the year.
Bullion advanced as much as 1.7% to $4,328 an ounce, erasing the drop in the previous session. US and Iranian officials signed the peace agreement electronically on Wednesday evening but it was unclear if the Strait of Hormuz had yet reopened.
The Fed kept interest rates unchanged on Wednesday, saying it would deliver price stability, and removed a reference in its statement to additional rate adjustments. Traders are now fully pricing in a tightening of monetary policy by October. Higher interest rates are a headwind for precious metals, which don’t pay interest.
Spot gold rose 1.6% to $4,322.83 an ounce as of 9:21 a.m. Singapore time. Silver gained 2.5% to $69.61, after falling 3% in the previous session. Platinum and palladium climbed. The Bloomberg Dollar Spot Index was down 0.2%, after gaining 0.7% in the previous session.
