Dow Jones futures climb even as risk-averse mood prevails

US Stock Futures Edge Higher Amid Geopolitical Tensions

During European trading hours on Monday, Dow Jones futures advanced by 0.20%, climbing above the 45,500 mark before the US market opened. At the same time, S&P 500 and Nasdaq 100 futures posted gains of 0.30% and 0.25%, reaching approximately 6,430 and 23,390, respectively.

Despite these early increases, US equity futures could face downward pressure due to growing risk aversion linked to ongoing uncertainty surrounding the Iran situation. Former President Donald Trump, in an interview with the Financial Times, suggested the US might seize Iranian oil assets, including the key export facility at Kharg Island, which he described as unprotected. Nevertheless, Trump also noted that indirect negotiations with Tehran are making significant progress, with the possibility of reaching an agreement in the near future.

According to a recent Wall Street Journal report, the US Department of Defense is considering sending an additional 10,000 troops to Iran. In response, Ebrahim Zolfaqari issued a stern warning on Iranian state television, declaring that American forces would become "food for the sharks of the Persian Gulf."

Meanwhile, Iran-aligned Houthi militants in Yemen launched their initial attacks on Israel over the weekend, escalating the regional conflict. The group has vowed to continue its assaults until military actions against Iran and its partners come to an end. They have also threatened vital shipping lanes in the Red Sea and critical Saudi energy infrastructure, increasing concerns about global supply disruptions.

Investors will be closely monitoring a speech by Federal Reserve Chair Jerome Powell scheduled for late Monday. On the corporate earnings front, attention will be on Terns Pharmaceuticals, Inc., Allied Gold Corporation, and USA Rare Earth, Inc. Additionally, market participants are awaiting key US economic data releases this week, including labor market statistics such as Nonfarm Payrolls (NFP) and the ISM Purchasing Managers’ Index (PMI).