The US stock futures indicated a positive start for Wall Street on Thursday, 18 June, after a sharp sell-off in the previous session. S&P 500 futures climbed 0.9%, while Nasdaq 100 futures advanced 1.6%. Dow Jones Industrial Average futures were up 0.06%.
During Wednesday’s session, all three benchmark indices closed more than 1% lower after the Federal Reserve’s first policy meeting under Chairman Kevin Warsh raised concerns about the future path of monetary policy.
Of the 18 Federal Reserve officials who submitted interest-rate projections, nine now expect rates to rise this year, reflecting concerns that inflation could remain elevated amid higher oil prices following the Iran conflict.
Policymakers now expect PCE inflation to reach 3.6% by year-end, higher than the recent forecast of 2.7%.
While Fed officials said the economy remains resilient despite tensions in the Middle East, they lowered their year-end GDP growth forecast to 2.2% from 2.4% projected in March.
Meanwhile, the Federal Reserve removed forward-guidance language from its policy statement, signalling a shift toward a more data-dependent approach under Chairman Kevin Warsh.
On the geopolitical front, US President Donald Trump reportedly told reporters that he signed an interim agreement with Iran at the Palace of Versailles near Paris, Bloomberg reported.
While a US official said the memorandum of understanding was now in effect, it remained unclear whether Tehran had immediately begun taking steps to fully reopen the Strait of Hormuz.
“Attention now shifts to upcoming economic data and earnings reports, with investors looking for confirmation that corporate profits can continue supporting elevated market valuations,” said domestic brokerage firm Vested Finance.
Crude oil prices slip back to pre-war levels
Oil prices fell more than 1% in trade, hitting their lowest levels since the early days of the Iran conflict, as a US-Iran interim agreement to end hostilities, reopen the Strait of Hormuz, and ease sanctions on Tehran improved the global supply outlook.
Brent crude futures declined $1.02, or 1.28%, to $78.53 a barrel, the lowest level since March 2. US West Texas Intermediate (WTI) crude fell $1.48, or 1.93%, to $75.31 a barrel, marking its lowest level since March 4.
The decline in oil prices has eased inflation concerns and boosted confidence that the economic impact of the Middle East conflict may be more limited than initially feared, according to Vested Finance.
Meanwhile, the International Energy Agency (IEA) warned of a potential supply glut, projecting global oil supply to increase by 8 million barrels per day by 2027, compared with demand growth of just 2 million barrels per day.
US stocks in focus today
Among individual stocks, Intel shares rose 9.3% in premarket trading after US President Donald Trump said Apple had agreed to work with the company to design and manufacture chips in the United States.
Other technology stocks were also trading higher. Nvidia gained 1%, while Micron Technology and Marvell Technology advanced 4% each.
Among other notable movers, Rumble jumped 16.2% after rebranding itself as RUM Group and completing its acquisition of German AI cloud company Northern Data. Smith & Wesson soared 16.6% after reporting a rise in fourth-quarter sales.
(With inputs from Bloomberg and Reuters)
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
