Futures on the Dow Jones are down over 400 points in early trading, while those on the S&P 500 and Nasdaq are down 65 and 250 points respectively. The S&P 500 and Nasdaq ended at record highs on Friday, with the Nasdaq lodging its longest winning streak since 1992.
The latest escalation comes after the US President Donald Trump posted on Truth Social that the US has struck and seized and Iranian-flagged ship Touska in the Gulf of Oman in continuation of their Naval blockade of the Strait of Hormuz.
“The Iranian crew refused to listen, so our Navy ship stopped them right in their tracks by blowing a hole in the engineroom,” Trump said in a Truth Social post, adding that the marines now have custody of the vessel.
Oil prices, which had plunged on Friday, post the announcement that the Strait of Hormuz is now open till the period of the ceasefire, surged as much as 8% in early trading in Asia. West Texas Intermediate is back at the $90 a barrel mark.
While Trump announced on Truth Social on Sunday that his delegation will head to Islamabad on Monday evening for the next round of talks, Iran has denied participation, as per its state new agency IRNA, citing no specific source.
“Iran stated that its absence from the second round of talks stems from what it called Washington’s excessive demands, unrealistic expectations, constant shifts in stance, repeated contradictions, and the ongoing naval blockade, which it considers a breach of the ceasefire,” IRNA wrote.
The news agency went on to add that under such circumstances, the outlook for constructive talks seem bleak.
Developments surrounding the war will remain the key focal point on Wall Street, even though the indices have been on a tear in the last few sessions, on hopes that there will eventually be a peace deal between the three warring parties.
In-line with the fall in risk assets, prices of Gold and Silver are also down between 1% to 2% after last week’s rebound, while the US Dollar index has seen modest gains.
