US stock futures plunged on Monday while oil prices surged, as military strikes by the US and Israel on Iran jolted global markets.
Dow Jones Industrial Average futures (YM=F) tumbled 1.6%, or over 800 points. Contracts on the S&P 500 (ES=F) sank 1.7%, while those on the tech-heavy Nasdaq 100 (NQ=F) dived 2% as the escalating Middle East conflict spurred a retreat from risk assets.
The strikes on Iran began late Saturday after Tehran rejected US demands to scale back its nuclear program. Its Supreme Leader Ali Khamenei died in the bombing campaign, and Iranian leaders have promised a strong response, raising the possibility of a broader regional confrontation. President Trump has said the strikes will continue until the US achieves its objectives.
Iran is OPEC’s fourth-largest producer, and oil prices jumped in the immediate aftermath, with Brent crude futures (BZ=F) surging 13%. The international benchmark moderated gains to around 10% on Monday, but still topped $80 a barrel. US benchmark West Texas Intermediate (CL=F) traded just above $73, up around 9%. Meanwhile, gold (GC=F) jumped to top $5,400 an ounce as investors sought less risky assets.
The geopolitical shock adds to an already uneasy environment for equities. The S&P 500 (^GSPC) ended Friday lower and closed February in negative territory as renewed volatility in artificial intelligence and software stocks rattled markets. Investors have increasingly questioned whether rapid AI adoption could undermine traditional software companies’ business models.
Headlining the week’s economic calendar is Friday’s February jobs report, with Wall Street expecting the US to have added 60,000 jobs, down from January’s stronger-than-expected 130,000 gain that eased recession fears.
In corporate news, earnings season continues, with Broadcom (AVGO) reporting on Wednesday, followed by Marvell Technology (MRVL) on Thursday. Retail earnings will also be in focus, led by Target (TGT) and Costco (COST).
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