(Reuters) -U.S. stock index futures edged up on Monday after oil prices pulled back from sharp gains earlier with investors awaiting Iran’s response to U.S. attacks on its nuclear sites.
Over the weekend, the United States launched strikes on Iran’s nuclear facilities, and President Donald Trump hinted at the possibility of regime change in Iran.
Oil prices briefly hit a five-month high amid rising concerns around Iran shutting the Strait of Hormuz, a key oil supply route. Brent futures were nearly flat at $77.06 a barrel as of 05:49 a.m. ET.
Energy stocks rose in premarket trade, tracking a surge in crude prices. Shares of energy majors Chevron rose 0.8% and Exxon gained 1.1%.
Defense stocks also rose, with Lockheed Martin up 0.8%, RTX Corporation gaining 0.9%, Northrop Grumman advancing 1.2% and L3harris Technologies jumping 1.3%.
“There is tension but not trauma as investors monitor developments in the Middle East,” Richard Hunter, head of markets at Interactive Investor, said in a note.
As markets grapple with existing price pressures from Trump’s tariffs, the oil price volatility adds a new layer of inflation concerns, with the 90-day suspension for U.S. tariffs nearing.
At 05:15 a.m. ET, Dow E-minis were up 38 points, or 0.09%, S&P 500 E-minis were up 13.75 points, or 0.23%. Nasdaq 100 E-minis were up 61.25 points, or 0.28%.
Among other movers, Tesla rose 1.6% after the electric vehicle maker deployed 10 self-driving taxis in Texas, marking the first time Tesla cars without human drivers carried paying riders.
Shares of U.S. carriers were mostly down, with Delta Air Lines, Southwest Airlines, United Airlines and American Airlines falling between 0.3% and 0.8%.
Following a strong rally in equities last month, which pushed indexes close to their record levels, investor momentum was bruised by rising geopolitical tensions.
The benchmark S&P 500 index remains about 3% below its record level.
In major data, preliminary June PMI data is due at 09:45 a.m. ET and existing home sales data for May is scheduled at 10:00 a.m. ET.
U.S. Federal Reserve Board Governor Christopher Waller, Fed Chicago President Austan Goolsbee, and Fed San Francisco President Mary Daly are scheduled to speak later in the day.
(Reporting by Kanchana Chakravarty in Bengaluru; Editing by Rashmi Aich)
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