Futures on the Dow Jones gained as much as 200 points, while those on the S&P 500 and Nasdaq gained 30 and 115 points respectively. All three indices had ended the Tuesday’s trading session at the lows of the day.
US President Donald Trump said that the extension was warranted due to Iran’s government being “seriously fractured”, and that the ceasefire would continue “until such times as” Iran’s leaders and representatives submit a “unified proposal” to end the war. Trump had earlier said that he does not intend to extend the ceasefire with Iran, which was supposed to end Wednesday evening.
The $720 billion Exchange Traded Fund tracking the S&P 500 has also rose in late Tuesday trading. However, the gains, unlike earlier ceasefire announcements are not as pronounced as the blockade of the Strait of Hormuz still continues and with Iran continuing to maintain that they will not be coerced into talks till the crucial waterway remains blocked.
Oil prices have also opened with modest gains this morning, despite the ceasefire announcement, with Citigroup analysts warning that they could jump back to $110 a barrel, if the blockade continues for long.
While stocks fell in Tuesday’s trade after the US delegation put off its trip to Pakistan, another factor that could’ve added to the pressure is Fed Chair nominee Kevin Warsh, who said that he will not take orders from the US President on interest rates and will act as an independent actor.
The Dow Jones ended the regular session on Tuesday with losses of 300 points, while the S&P 500 and Nasdaq also ended near the lows of the day with both indices declining 0.6% each.
“Waiting in cash for the all-clear sign is never a profitable strategy, but there are plenty of risks ahead,” said Chris Zaccarelli at Northlight Asset Management. “So it also doesn’t make sense to move to a high risk-taking posture either.”
Today is an important day on the earnings front as well, with companies such as Tesla, GE Vernova, IBM, Texas Instruments, Boeing and AT&T reporting results during the course of the day.
(With Inputs From Agencies)
