- Trump issued a 48-hour ultimatum to Iran to reopen the Strait of Hormuz, while Tehran warned it could target U.S. and regional energy infrastructure.
- Iraq declared force majeure on foreign-operated oilfields, and the IEA warned that the global oil market faces its largest-ever supply shock.
- 10-year Treasury yields climbed to 4.38%, while Asian markets opened lower.
U.S. stock futures were mixed late Sunday as traders weighed escalating Middle East tensions, volatile oil prices and rising treasury yields after Wall Street logged its fourth straight weekly loss.
As of 10.40 p.m. ET, Nasdaq 100 and S&P 500 futures were down by 0.2%, while Dow futures were trading slightly higher.
On Stocktwits, retail sentiment toward the SPDR S&P 500 ETF Trust (SPY) was ‘extremely bearish’ amid ‘high’ message volume, while sentiment toward the Invesco QQQ Trust (QQQ) and SPDR Dow Jones Industrial Average ETF Trust (DIA) was ‘bearish’ amid ‘normal’ message volume.
US Market Drivers
Markets reacted to escalating tensions in the Middle East after U.S. President Donald Trump issued a 48-hour ultimatum to Iran to reopen the Strait of Hormuz or face strikes on its power plants. Iran responded that it would shut the waterway indefinitely and target U.S. and Israeli energy infrastructure if such action were taken.
The conflict entered its fourth week with no signs of de-escalation. The Wall Street Journal reported that the Pentagon is sending thousands of additional Marines to the Middle East, while CBS News reported that heavy preparations were underway for potential ground troop deployment.
In the prior session, U.S. stocks fell sharply, with the Russell 2000 entering correction territory and both the Dow and Nasdaq briefly trading in correction territory intraday, as the major averages logged their fourth straight weekly loss. The S&P 500 slipped below its 200-day moving average for the first time since May, and broad-based selling was led by declines in Nvidia and Tesla:
| Index | Move | Close |
| Dow Jones Industrial Average | -0.96% | 45,577.47 |
| S&P 500 | -1.51% | 6,506.48 |
| Nasdaq Composite | -2.01% | 21,647.61 |
Oil markets remained volatile as the standoff over the Strait of Hormuz, a route that normally carries roughly a fifth of global oil and liquefied natural gas supply, continued to disrupt shipping flows. Brent crude hovered below $112 per barrel, and West Texas Intermediate traded near $98 after earlier swings that saw prices briefly spike and then reverse.
Iraq also declared force majeure on all oilfields operated by foreign companies on Friday, adding to supply concerns after Iran launched new attacks on energy facilities across the Persian Gulf region.
The International Energy Agency warned that the global oil market is facing its largest-ever shock as maritime traffic through the Strait of Hormuz has largely ground to a halt, forcing producers to lock in millions of barrels of daily supply or rely on limited alternative export routes.
Economist Robin Brooks, senior fellow at The Brookings Institution and former Goldman Sachs chief FX strategist, said on X that despite weekend escalations, oil markets showed limited reaction, adding that “what matters are actions, not words.”
Mohamed El-Erian, chief economic adviser at Allianz, said on X that the U.S. economy remains relatively better positioned than many peers during the conflict because it is primarily managing price spikes rather than facing direct supply shortages.
Trending Stocks To Watch On NYSE, Nasdaq
SPDR Gold Shares (GLD): The ETF fell to its lowest level in nearly three months as gold steadied near $4,515 after its steepest weekly drop in more than four decades amid rising oil-driven inflation risks.
Super Micro Computer (SMCI): The stock declined to its lowest level since November 2024 after a U.S. indictment alleged associates diverted Nvidia-powered AI servers to China without authorization, while Taiwanese analyst Ming-Chi Kuo said that about 10% of quarterly revenue was tied to such shipments even as gross margins declined.
AleAnna (ANNA): shares jumped 87% on Friday in their best session ever as geopolitical tensions underscored its positioning as a domestic natural-gas supplier in Italy, supporting Europe’s efforts to reduce reliance on foreign energy sources.
Tesla (TSLA): The stock slipped more than 1% in overnight trading on Sunday after CEO Elon Musk outlined plans for a proposed $25 billion Terafab chip facility, with analysts warning that the initiative depends on advanced semiconductor manufacturing capabilities currently controlled by only three global players.
Caledonia Mining (CMCL): Shares dropped to their lowest level since August 2025 on Friday ahead of quarterly results due Monday. Koyfin analysts expect quarter-over-quarter declines in core earnings despite a slight revenue growth.
How Global Markets Are Performing Today
In broader markets, the benchmark 10-year Treasury yield climbed to around 4.38%, its highest level since late July, while gold rebounded from its steepest weekly drop in more than four decades.
The bond sell-off extended a third straight week, with two-year Treasury yields rising as markets began pricing in the possibility that the Federal Reserve could shift toward rate hikes later this year amid the inflation shock from energy prices. Similar tightening expectations are building across Europe, Japan and the U.K.
Asian markets were lower at the open on Monday, with equities in Australia and Japan declining and MSCI’s broadest index of Asia-Pacific shares outside Japan falling 0.28%.
Among catalysts for Monday, investors will monitor U.S. construction spending data for January.
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