US Futures Jump as U.S.-Iran Deal Nears; Asia Rises

U.S. futures rose Monday after senior U.S. officials indicated talks with Iran were nearing a deal to reopen the Strait of Hormuz. The comments pushed the S&P 500 E-mini about 0.8% higher and lifted the Nasdaq 100 E-mini roughly 1.3%, while the dollar weakened and investors moved toward gold and silver.

Officials in Washington described progress in negotiations focused on reopening the shipping lane, though President Donald Trump earlier cautioned that he had told U.S. representatives ‘not to rush' into any agreement. Markets remained sensitive to any follow-up statements or formal announcements.

Asian markets extended the risk-on reaction. Japan’s Nikkei 225 surged about 3.1% to an intraday record of 65,330. Regional indexes including China A50, Australia’s ASX 200 and Singapore’s STI each rose about 0.6% to 0.7% as traders priced in lower near-term geopolitical risk. Currency trading showed a softer U.S. dollar, which eased pressure on some emerging-market currencies and supported commodity prices.

U.S. economic data added complexity. The University of Michigan’s final May consumer sentiment reading fell to a record low of 44.8, driven in part by higher gasoline costs that have pushed nationwide pump prices toward $5 per gallon. Short-term inflation expectations rose to 4.8%, and five-year inflation expectations climbed to 3.9%.

Kevin Warsh was sworn in as Federal Reserve chair on Friday and assumes leadership of the central bank with inflation expectations rising and consumer sentiment weakening. Market participants are watching for policy signals on interest rates and balance-sheet strategy.

Oil prices initially pulled back on optimism over the talks. Market data showed West Texas Intermediate slipped below its 50-day moving average during Asian trading. Technical levels place near-term resistance around $100.80 per barrel, with intermediate supports near $90.50 and $87.60. Spot gold rose about 1.2% to $4,564 an ounce and spot silver gained roughly 3.1% to $77.85 an ounce as the dollar eased.

The disruption to Middle East shipping has prompted several Southeast Asian countries to accelerate use of palm oil and other local crops in diesel and gasoline blends. That shift has tightened supplies of cooking oil and animal feed in the region and has implications for exports from major palm-oil producers such as Indonesia and Malaysia.

Fixed-income markets remained attentive to inflation expectations, with analysts noting Treasury yields are likely to react to further energy-driven price moves. Some technical analysts flagged potential exhaustion in the S&P 500’s eight-week rally.

Diplomatic and security events this week include a Quad foreign ministers meeting in New Delhi on Tuesday, with the Iran conflict on the agenda, and the Shangri-La Dialogue in Singapore later in the week. Philippine President Ferdinand Marcos Jr. is visiting Japan to discuss energy and maritime cooperation. Markets will also watch a Singapore core inflation report due later in the day. The top immediate market trigger remains any new details on the U.S.-Iran negotiations, which market participants say could move asset prices quickly as the situation becomes clearer.