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Summary
Stock futures fell on Sunday as investors worried about the ongoing closure of the Strait of Hormuz and its impact on oil markets. The Dow Jones industrial average futures dropped 0.35%, S&P 500 futures fell 0.26%, and Nasdaq futures lost 0.32%. U.S. oil futures rose 1.75% to $107.26 a barrel, while Brent crude climbed 1.32% to $110.70. The U.S.-China summit failed to produce a breakthrough to reopen the strait, and talks between the U.S. and Iran have stalled.
Our Reading
The numbers tell one story.
Wall Street is pricing in greater odds for rate hikes as bond yields soar. The 30-year Treasury yield hit 5% for the first time in two decades. The oil market is approaching a tipping point, with shortages worsening and inventories reaching critically low levels. JPMorgan, Capital Economics, and UBS all warn of an imminent crisis. Trump is weighing military options against Iran, saying “the clock is ticking” for the regime.
The Straits of Hormuz remains closed, and the oil market is running on fumes.
Author: Evan Null
