US equity-index futures were narrowly mixed early Monday as traders weighed a fresh impasse in Middle East peace talks against another leg higher in the global artificial intelligence trade. With roughly two and a half hours until the New York open, S&P 500, and Dow futures languished just below the flatline, while the Nasdaq 100 futures were marginally higher.
Asian stocks climbed as traders doubled down on the artificial AI trade, brushing aside Middle East tensions even after President Trump rejected Iran's latest peace proposal, sending crude oil higher and Treasuries lower. The risk tone in Europe was more cautious, with regional benchmarks oscillating around unchanged as energy-led inflation concerns capped gains.
Pre-Market Snapshot — 7:15 AM ET
- S&P 500 Futures: 7,414.75 (-0.06%)
- Dow Futures: 49,643.00 (-0.10%)
- Nasdaq-100 Futures: 29,364.25 (+0.01%)
- Russell 2000 Futures: 2,864.10 (-0.12%)
- VIX: 18.16 (+5.64%)
- WTI Crude Futures: $97.98 (+2.68%)
- Gold Futures: $4,676.60 (-1.14%)
- EUR/USD: 1.1773 (-0.12%)
- Bitcoin (USD): $81,119.16 (+0.41%)
Geopolitics Sets the Tone
The week's opening narrative is driven by an overnight breakdown in diplomacy. President Trump rejected Iran's response to a US proposal as "totally unacceptable," while Iranian state media said Tehran was seeking an end to conflict across the region, compensation for damage to Iranian targets, and sovereignty over key oil shipping routes. Those developments kept attention fixed on the Strait of Hormuz, a critical artery for global energy flows. Any disruption there risks sending oil prices higher and adding to the inflation pressures that central banks have spent the past two years trying to contain.
Israeli Prime Minister Benjamin Netanyahu also stated that the conflict is not over, emphasizing that the U.S. and Israel remain committed to limiting Iran's nuclear ambitions. The hardening rhetoric on both sides has revived a war-risk premium across crude, defense, and forex markets that had partially faded last week.
Overnight in Asia: Chips Lead, Nintendo Lags
Asian equities largely shrugged off the diplomatic setback, taking their cue instead from Friday's record close in US semiconductor names. MSCI's Asia Pacific gauge rose 0.43%, with technology shares outperforming. South Korea, a poster child for AI investments, gained 5% to a record, and a Bloomberg gauge of Asian chipmakers hit a peak after the Philadelphia Semiconductor Index surged to an all-time high on Friday.
South Korea's Kospi ended the session 4.32% higher at 7,822.24, with index heavyweight SK Hynix rallying more than 11%. Japan was the regional laggard: the Nikkei 225 slipped 0.47% to 62,417.88, while the Topix edged up 0.3% to 3,840.93. Nintendo shares fell over 8% after the game developer announced it would hike Switch 2 prices while guiding for a decline in console sales.
Chinese markets edged higher despite a hot inflation print. The CSI 300 added 1.64% to 4,951.84, while Hong Kong's Hang Seng was flat in its final hour of trade. China's consumer and producer inflation both came in above expectations in April, driven by higher commodity costs linked to the Middle East conflict. Australia's S&P/ASX 200 dipped 0.49% to 8,701.80.
Europe: Caught Between Growth and Oil
European bourses opened mixed and stayed close to unchanged through the morning. Britain's FTSE 100 rose marginally, France's CAC 40 fell over 1%, and Germany's DAX was down about 0.25%. The European market istcaught between signs of economic resilience and renewed concern that higher energy costs could reignite inflation and weigh on growth.
Sector dispersion told the story of the session. Defense stocks came under pressure, with Rheinmetall falling more than 3% and Leonardo down about 4%. Luxury names also traded lower: LVMH, L'Oréal and Hermès were all notably lower. On the other side, energy stocks advanced alongside oil, with Shell and TotalEnergies rising over 1% each.
With no major data releases or earnings reports scheduled for Monday, investors had little from the European calendar to drive sentiment.
Commodities: Crude Reclaims $97, Gold Pulls Back
Crude oil is the cleanest expression of Monday's geopolitical re-pricing, with WTI up more than 2% and trading near $98 in the early U.S. hours. The rally is seen as a direct consequence of the weekend's collapse in peace optimism and renewed Hormuz transit risk. Gold, by contrast, gave back some of its recent safe-haven gains, sliding more than 1% to a little over $4,670 an ounce as the dollar firmed and Treasury yields ticked higher.
Silver was up modestly, trading above $81, and copper futures extended last week's gains on China demand signals
FX: Dollar Firms, Euro and Yen on the Back Foot
The dollar remained bid across the board as traders rotate into safety and out of European and Japanese exposures most sensitive to an oil shock. EUR/USD slipped about 0.2% to 1.1770, with the single currency caught between resilient eurozone activity data and the inflationary threat from a renewed crude rally. Sterling also headed southward as traders digested adverse election results for the ruling Labor Party in the election held across Scotland, Wales and 136 English local authorities, while commodity-linked currencies tracked the oil tape.
The yen remains the standout vulnerability in G-10. With limited near-term BoJ tightening in sight and U.S. rates comparatively high, the yen is struggling to find sustained support from monetary policy alone — and as a major energy importer, Japan faces an added headwind from rising oil.
What's on the US Calendar
The economic docket is light to open the week, putting more weight on this week's inflation prints and earnings:
- May 11: April existing home sales; earnings from Constellation Energy (CEG) and Circle Internet Group (CRCL)
- May 12: April CPI and core CPI; earnings from JD.com (JD)
- May 13: April PPI and core PPI; earnings from Alibaba (BABA) and Cisco (CSCO)
Traders are also positioning ahead of a high-stakes diplomatic event: the planned May 14–15 meeting between Trump and President Xi Jinping in Beijing. U.S. and Chinese officials have reportedly intensified discussions on extending the current trade truce and exploring agreements on agricultural purchases, AI safeguards, and supply chain resilience, a signal that both sides remain focused on preventing renewed escalation, despite persistent tensions over Taiwan, technology controls, and broader geopolitical issues.
Stocks to Watch at the Open
- Semiconductors — The SOX hit a record Friday and SK Hynix rallied more than 11% overnight; watch Nvidia, AMD, Broadcom, and Micron for follow-through
- Energy — Integrated majors and E&Ps tracking WTI's move back above $97; Shell and TotalEnergies already firmer in London
- Defense — Mixed signal after European defense names sold off on profit-taking despite the diplomatic breakdown
- Constellation Energy (CEG) and Circle Internet Group (CRCL) — Both report earnings before the bell
- Nintendo ADRs — Reaction trade after Tokyo-listed shares slid on Switch 2 pricing and volume guidance
Volatility expectations are nudging higher into the open, with the VIX up nearly 6% in pre-market trade to just above 18, a reminder that even with futures little changed on screen, hedging demand is building as the cash session approaches.
