U.S. equity futures were mixed early Tuesday as a renewed surge in crude oil, a hawkish surprise from the Bank of Japan and stalled U.S.-Iran diplomacy set a cautious tone ahead of the open, with traders also positioning for a marquee week of mega-cap tech earnings and the Federal Reserve's policy decision Wednesday.
The sharp pullback in tech-heavy futures contracts follows fresh records on Wall Street. The S&P 500 and tech-heavy Nasdaq hit new intraday and closing highs on Monday, while the Dow Jones Industrial Average lagged.
Pre-Market Snapshot (Quotes as of 7:40 a.m. ET)
- S&P 500 Futures: 7,165.25 (-0.56%)
- Dow Futures: 49,549(+0.18%)
- Nasdaq-100 Futures: 27,142.75 (-1.08%)
- Russell 2000 Futures: 2,780.80(+0.10%)
- VIX: 18.87 (+4.78%)
- WTI Crude Futures: $100.83 (+4.63%)
- Gold Futures: $4,605 (-1.89%)
- EUR/USD: 1.1692 (-0.25%)
- Bitcoin (USD): $76.255.92 (-2.03%)
Energy: Crude Extends Rally
Oil resumed its climb overnight as the Strait of Hormuz remained effectively shut. The West Texas Intermediate (WTI)-grade futures traded up over $100-a-barrel, up from a previous close of $96.37, with an intraday range of 96.26 to 99.23.
Brent crude futures climbed above $111 per barrel on Tuesday, advancing toward levels last seen in late-March as stalled efforts to end the US–Iran conflict and reopen the Strait of Hormuz kept markets on edge. President Donald Trump was reportedly dissatisfied with Iran's latest proposal, with Tehran's nuclear program remaining a central point of contention. Iran conveyed through Pakistan that hostilities could cease if Washington lifted its naval blockade, agreed to a revised framework for transit through Hormuz, and provided assurances against future military action.
Flows through the Strait of Hormuz, typically accounting for roughly 20% of global energy consumption, remain effectively halted, sustaining upward pressure on prices.
Metals: Gold Reverses Lower
Both precious and industrial metals came under selling pressure on Tuesday. Gold futures fell more than 1.50% with silver off nearly 3% and copper down 1.70%.
Gold prices reversed course to fall sharply in Asian trade on Tuesday as persistent strength in oil and hawkish central bank signaling weighed on the non-yielding metal.
Forex: Yen Firms After BOJ "Hawkish Hold"
The Bank of Japan's decision to hold rates on Tuesday is seen as hawkish and contributed to the yen's gains against the dollar in the Asian session, strategists say. The yen has since retreated. The BOJ left its benchmark rate unchanged, with a split vote signaling increased odds of a hike in June, pushing the yen higher.
The policy board maintained the uncollateralized overnight call rate at 0.75%. Skipping a rate increase was a dovish move on the surface, but three members opposing the pause and advocating for an immediate increase in borrowing costs signals the possibility of a hawkish path going forward.
The forex market was relatively quiet during the Asian session. The strongest major currency since the Tokyo open was the Japanese yen, while the New Zealand dollar has been the weakest. USD/JPY rebounded back toward the 160 level after weakening in the Asian session following the BoJ eate decision.
EUR/USD traded with mild losses under $1.17. The modest weakness reflects fragile sentiment due to stalled US-Iran peace talks. Markets might turn cautious ahead of the Fed and the European Central Bank interest rate decisions later this week.
Earnings Spotlight: UPS
UPS shares fell more than 3% despite the company reporting a first-quarter earnings beat and reaffirming its full-year guidance. Spotify (SPOT) slumped more than 11% after the music streaming service’s first-quarter subscriber target and guidance disappointed investors.
Oracle Corp. (ORCL) stock fell sharply after OpenAI’s fundamental woes rendered traders cautious regarding infrastructure spending by the ChatGPT maker.
On the other hand, Coca-Cola shares rose more than 3% following its earnings beat
Among the key earnings after the market close are NXP Semiconductor, Bookings Holdings, Caesars Entertainment, Robinhood Markets, Seagate Technologies, Starbucks, T-Mobile US, and Visa
Central Bank-Heavy Week
The marathon round of central bank meetings starts with the Bank of Japan, followed by the Fed and the Bank of Canada on Wednesday and the ECB on Thursday. Though none are expected to raise or lower rates, the fast pace could drive market volatility and reverberate around the Treasury market.
Traders may also focus on the Conference Board's consumer confidence survey for April that is due after the market opens.
Read Next: Update: BoJ Pauses Again Despite Growing Hawkish Pressure; Eyes on Ueda for Rate-Hike Signals
