U.S. Stocks May Show A Lack Of Direction In Early Trading

U.S. Stocks May Show A Lack Of Direction In Early Trading

The major U.S. index futures are currently pointing to a roughly flat open on Monday, with stocks likely to show a lack of direction after ending last Friday’s trading mostly lower.

Traders may be reluctant to make significant moves as they as investors await Iran’s response to the weekend U.S. airstrikes on its nuclear sites.

Media reports suggest that Iran is mulling blocking the Strait of Hormuz, a key artery for global oil and gas supplies being sent around the world from the Middle East.

Other reports said that Iran may target one of several U.S. military bases located throughout the region.

Meanwhile, Israeli officials have signaled that the country is prepared to halt its military campaign against Iran if Supreme Leader Ayatollah Ali Khamenei ceases hostilities and seeks a resolution to the conflict.

U.S. stocks fell broadly on Friday as investors reacted to rising Middle East tensions and pondered future interest rate decisions.

The S&P 500 eased 0.2 percent and the tech-heavy Nasdaq Composite declined half a percent after reports emerged the U.S. may revoke waivers for some semiconductor firms.

The narrower Dow finished marginally higher as Fed Governor Christopher Waller said that he doesn’t expect tariffs to boost inflation significantly and that there is room for a rate cut as early as July.

Commodity, Currency Markets

Crude oil futures are falling $0.38 to $73.46 a barrel after rising $0.34 to $73.84 a barrel last Friday. Meanwhile, after sliding $22.40 to $3,385.70 an ounce in the previous session, gold futures are slipping $12 to $3,373.70 an ounce.

On the currency front, the U.S. dollar is trading at 147.39 yen versus the 146.09 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.1465 compared to last Friday’s $1.1523.

Asia

Asian stocks ended mixed on Monday as markets took U.S. strikes against nuclear targets in Iran in stride and waited to see how Iran reacts and what happens to Tehran’s nuclear program.

U.S. Defense Secretary Pete Hegseth said Sunday that the strikes had “devastated the Iranian nuclear program,” though some officials cautioned that the extent of the damage was unclear.

Oil prices gave up early gains after rising over 4 percent early in the session in a knee-jerk reaction to the escalating conflict in the region, which began with an Israeli attack against Iran on June 13th.

It remains to be seen whether Iran will close the Strait of Hormuz, through which much of the world’s crude passes. Much of East Asia relies heavily on oil imported through the Strait of Hormuz.

Gold edged lower in Asian trade as geopolitical and tariff uncertainties lifted the dollar.

Mainland China and Hong Kong markets reversed initial losses to end higher. China’s Shanghai Composite Index rose 0.7 percent to 3,381.58, while the Hang Seng Index settled 0.7 percent higher at 23,689.13.

Japanese markets trimmed early losses to end slightly lower. The Nikkei 225 Index edged down 0.1 percent to 38,354.09 and the broader Topix Index closed down 0.4 percent at 2,761.18, with a weaker yen helping limit overall losses.

Seoul stocks declined to snap a five-day winning streak. The Kospi dipped 0.2 percent to 3,014.47 and the won hit a one-month low after the U.S. used B-2 bombers to launch airstrikes on three key nuclear sites in Iran on Saturday.

Chip, bio and battery shares led losses, with Samsung Electronics, Samsung Biologics and LG Energy Solution falling 2-4 percent.

Australian markets fell to end near three-week lows, with industrial stocks suffering heavy losses on concerns the Middle East conflict could affect travel and shipping.

The benchmark S&P/ASX 200 Index fell 0.4 percent to 8,474.90, extending losses for a fifth straight session. The broader All Ordinaries Index ended down 0.4 percent at 8,688.

Adairs plunged 20.5 percent to an over two-month low after the furniture retailer reported a decline in second-half earnings guidance.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index dropped 0.3 percent to 12,532.65.

Europe

European stocks have moved mostly lower on Monday as investors waited for Iran’s response to the weekend U.S. airstrikes on its nuclear sites.

Media reports suggest that Iran is mulling blocking the Strait of Hormuz, a key artery for global oil and gas supplies being sent around the world from the Middle East.

Other reports said that Iran may target one of several U.S. military bases located throughout the region.

Meanwhile, Israeli officials have signaled that the country is prepared to halt its military campaign against Iran if Supreme Leader Ayatollah Ali Khamenei ceases hostilities and seeks a resolution to the conflict.

While the French CAC 40 Index is down by 0.8 percent, the German DAX Index is down by 0.5 percent and the U.K.’s FTSE 100 Index is down by 0.2 percent.

In corporate news, technology investor Prosus NV rose over 1 percent after it swung into profit for the first time.

Sanofi was moving higher after an announcement that the European Medicines Agency’s (EMA) CHMP has recommended approval of Sarclisa, in combination with lenalidomide, bortezomib, and dexamethasone (VRd).

Online trading platform Plus500 gained 1.3 percent after it received new regulatory license in Canada.

Spectris soared 15 percent after Advent International announced a £3.8 billion all-cash deal to buy the British scientific instrument manufacturer at a significant premium.

U.S. Economic News

The National Association of Realtors is scheduled to release its report on existing home sales in the month of May at 10 am ET. Existing home sales are expected to decrease to an annual rate of 3.96 million in May from a rate of 4.00 million in April.

Also at 10 am ET, Federal Reserve Vice Chair for Supervision Michelle Bowman is due to speak on monetary policy and banking before the 2025 International Journal of Central Banking Conference.

Chicago Federal Reserve President Austan Goolsbee is scheduled to participate in a moderated question-and-answer session before the Milwaukee Business Journal Mid-Year Outlook 2025 at 1:10 pm ET.

At 2:30 pm ET, Federal Reserve Board Governor Adriana Kugler is due to deliver welcome remarks before a “Fed Listens” event hosted by the Federal Reserve Bank of New York.