Stock Index Futures Rally on Prospect of End to Middle East Conflict, U.S. Economic Data and Fed Speak in Focus

June S&P 500 E-Mini futures (ESM26) are up +1.02%, and June Nasdaq 100 E-Mini futures (NQM26) are up +0.94% this morning as sentiment got a boost after President Trump reportedly told aides he was willing to end the U.S. military campaign against Iran.

The Wall Street Journal reported that President Trump told aides he is willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed. In recent days, President Trump and his aides assessed that a mission to reopen the waterway would extend the conflict beyond his four- to six-week timeline, the report said. Trump told aides that the U.S. should achieve its primary objectives of crippling Iran’s navy and missile arsenal while applying diplomatic pressure on Tehran to resume the free flow of trade. Treasury yields fell following the WSJ report, with the benchmark 10-year yield dropping five basis points to 4.31%.

Deutsche Bank said the report “raised hopes that the current phase of the conflict will wind down soon, and we’ve seen a clear market reaction in response.”

The price of WTI crude was little changed on Tuesday. The WSJ said that the U.S. conducted a massive strike on a large ammunition depot in the Iranian city of Isfahan on Monday night. Meantime, an Iranian drone struck a fully loaded Kuwaiti oil tanker off Dubai early on Tuesday in one of the most significant vessel attacks during the month of the conflict.

Investors are also awaiting a fresh batch of U.S. economic data, comments from Federal Reserve officials, and an earnings report from sportswear giant Nike.

In yesterday’s trading session, Wall Street’s main stock indexes ended mixed. Chip and AI-infrastructure stocks tumbled, with Micron Technology (MU) sinking over -9% to lead losers in the Nasdaq 100 and Marvell Technology (MRVL) plunging more than -7%. Also, Sysco Corp. (SYY) cratered over -15% and was the top percentage loser on the S&P 500 after agreeing to acquire Jetro Restaurant Depot for $29.1 billion, including debt. In addition, Boston Scientific (BSX) slumped more than -9% after the company reported mixed data for its Watchman heart implant. On the bullish side, software stocks advanced, with ServiceNow (NOW) climbing over +5% to lead gainers in the S&P 500 and Workday (WDAY) rising more than +3%.

Fed Chair Jerome Powell said on Monday that longer-term inflation expectations seem to be in check, but that the central bank is closely monitoring them as it evaluates the impact of the Middle East conflict. Inflation expectations appear to be “well anchored beyond the short term,” Powell said. He added that policymakers might need to respond to the fallout from the conflict, but that the time has not yet come.

“Fed Chair Powell’s calm tone, along with overdue market focus on the growth risks from higher-for-longer oil are helping to fuel a turn in rates pricing,” said Krishna Guha at Evercore. “The probability of one or more cuts is much higher than the probability of a hike.”

Meanwhile, U.S. rate futures have priced in a 97.4% chance of no rate change and a 2.6% chance of a 25 basis point rate hike at the April FOMC meeting.

Today, investors will focus on U.S. JOLTs Job Openings figures, set to be released in a couple of hours. Economists, on average, forecast that February JOLTs Job Openings will arrive at 6.890 million, compared to the January figure of 6.946 million.

The U.S. Conference Board’s Consumer Confidence Index will also be closely monitored today. Economists anticipate that the March figure will stand at 87.8, compared to 91.2 in February.

The U.S. S&P/CS HPI Composite - 20 n.s.a. will be released today. Economists expect the January figure to rise +1.4% y/y, unchanged from December.

The U.S. Chicago PMI will be released today as well. Economists forecast the March figure at 54.8, compared to the previous value of 57.7.

In addition, market participants will parse comments today from Fed Vice Chair for Supervision Michelle Bowman, Fed Governor Michael Barr, Chicago Fed President Austan Goolsbee, and Kansas City Fed President Jeff Schmid.

On the earnings front, notable companies such as Nike (NKE), McCormick & Co. (MKC), and PVH Corp. (PVH) are set to report their quarterly figures today.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.31%, down -1.15%.

The Euro Stoxx 50 Index is up +0.58% this morning as tentative hopes for a resolution to the Middle East conflict boosted sentiment. Financial and mining stocks led the gains on Tuesday. Software stocks also climbed. At the same time, semiconductor stocks continued to slide. The benchmark index is on track for its largest monthly decline since 2020. Preliminary data from Eurostat released on Tuesday showed that the Eurozone’s annual inflation rate rose at its fastest pace in more than a year in March as the Middle East conflict drove energy prices higher, a move that, if sustained, could prompt the European Central Bank to raise interest rates. Separately, data showed that Germany’s unemployment rate remained unchanged in March, but the impact of the Middle East conflict is likely to increasingly weigh on the labor market outlook. Meanwhile, Reuters reported on Tuesday that Germany’s leading economic institutes lowered their growth forecasts for this year and next while significantly raising their inflation projections in response to the Middle East conflict. In corporate news, UBS Group AG (UBSG.Z.IX) rose over +3% after the Financial Times reported that Swiss lawmakers had assured the bank they would relax rules, enabling it to raise its capital requirement by $22 billion.

U.K. GDP, Germany’s Retail Sales, Germany’s Unemployment Change, Germany’s Unemployment Rate, Eurozone’s CPI (preliminary), and Eurozone’s Core CPI (preliminary) data were released today.

U.K. GDP has been reported at +0.1% q/q and +1.0% y/y in the fourth quarter, in line with expectations.

The German February Retail Sales fell -0.6% m/m and rose +0.7% y/y, weaker than expectations of +0.3% m/m and +1.0% y/y.

The German March Unemployment Change stood at 0K, stronger than expectations of 2K.

The German March Unemployment Rate was 6.3%, in line with expectations.

Eurozone’s March CPI rose +2.5% y/y, weaker than expectations of +2.6% y/y.

Eurozone’s March Core CPI rose +2.3% y/y, weaker than expectations of +2.4% y/y.

Asian stock markets today settled in the red. China’s Shanghai Composite Index (SHCOMP) closed down -0.80%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -1.58%. 

China’s Shanghai Composite Index closed lower today as upbeat PMI data from the country failed to offset investor worries about the Middle East conflict. Coal and semiconductor stocks underperformed on Tuesday. The benchmark index notched its steepest monthly decline since January 2022. Still, Chinese equities fared better than global peers in the Iran-driven rout, with their outperformance the strongest since August 2025. An official survey released on Tuesday showed that China’s factory activity returned to expansion in March, partly due to seasonal factors, but as the Middle East conflict heightens supply shock risks, businesses are beginning to feel the strain. China’s non-manufacturing PMI, which covers both services and construction activity, also returned to expansion territory this month. ANZ Research economists said the PMI data support the view that first-quarter GDP growth will likely surpass 4.5%. In other news, Chinese officials are stepping up efforts to tax offshore trusts holding shares in certain Hong Kong-listed companies, tightening scrutiny on a structure the country’s ultra-wealthy have used to invest billions of dollars overseas. In corporate news, J&T Global Express jumped over +11% in Hong Kong after the logistics firm reported strong second-half and full-year results.

The Chinese March Manufacturing PMI came in at 50.4, stronger than expectations of 50.1.

The Chinese March Non-Manufacturing PMI arrived at 50.1, stronger than expectations of 49.9.

Japan’s Nikkei 225 Stock Index closed lower today as a report that President Trump was willing to end the war with Iran failed to boost risk sentiment. Energy, industrial, and technology stocks led the declines on Tuesday. The benchmark index posted its largest monthly decline since the 2008 global financial crisis. Japan is among the most exposed major economies to the fallout of Middle East tensions, with over 90% of its oil imports sourced from the region. Government data released on Tuesday showed that annual core inflation in Tokyo eased to a nearly two-year low in March and remained below the Bank of Japan’s target for a second consecutive month, as fuel subsidies offset rising raw material costs driven by a weak yen. However, analysts expect the slowdown to be temporary as surging oil prices stemming from the Middle East conflict, along with higher import costs from the weak yen, intensify inflationary pressures and prompt the BOJ to raise interest rates further. Separate data showed that Japan’s retail sales unexpectedly fell in February from a year earlier, highlighting the fragile nature of the country’s recovery even before the Middle East conflict erupted. In addition, data showed that Japan’s monthly industrial production fell in February, a pullback from the pre-holiday demand boost seen in the previous month. Meanwhile, Japanese Finance Minister Satsuki Katayama warned on Tuesday that the government was ready to respond “on all fronts” to market volatility as speculative moves were observed in the currency market as well as in the crude oil futures market. Investor attention for the remainder of the week is on the BOJ’s quarterly Tankan survey of business sentiment. Daiwa Institute of Research economist Kanako Nakamura expects sentiment among manufacturers to improve in the first quarter, supported by a weaker yen and robust chip demand, though the outlook remains uncertain amid the Middle East conflict. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -2.75% to 48.09.

The Japanese March Tokyo Core CPI rose +1.7% y/y, weaker than expectations of +1.8% y/y.

The Japanese February Industrial Production (preliminary) fell -2.1% m/m, in line with expectations.

The Japanese February Retail Sales unexpectedly fell -0.2% y/y, weaker than expectations of +0.9% y/y.

The Japanese February Unemployment Rate was 2.6%, stronger than expectations of 2.7%.

Pre-Market U.S. Stock Movers

The Magnificent Seven stocks rose in pre-market trading, with Meta Platforms (META) and Microsoft (MSFT) gaining over +1%.

Chip stocks advanced in pre-market trading, rebounding slightly from yesterday’s sell-off. Marvell Technology (MRVL), Advanced Micro Devices (AMD), and Intel (INTC) were up more than +1%.

McCormick & Co. (MKC) climbed over +4% in pre-market trading after the spice maker posted stronger-than-expected Q1 results. Also, Unilever said it was in advanced discussions to merge its foods business with the company.

Centessa Pharmaceuticals (CNTA) popped more than +46% in pre-market trading after Eli Lilly agreed to acquire the company in a deal worth up to about $7.8 billion, or $47 a share.

Colgate-Palmolive (CL) fell nearly -1% in pre-market trading after TD Cowen downgraded the stock to Hold from Buy.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Tuesday - March 31st

NIKE, Inc. (NKE), McCormick & Company (MKC), TD SYNNEX (SNX), FactSet Research Systems (FDS), PVH Corp. (PVH), RH (RH), Hotel101 Global Holdings (HBNB), nCino (NCNO), SEALSQ (LAES), Nano Dimension (NNDM), Dave & Buster’s Entertainment (PLAY), Hennessy Capital Investment Corp. VII (HVII), BRC Group Holdings (RILY), Taylor Devices (TAYD), Stellar V Capital (SVCC), J.Jill (JILL), CitroTech (CITR).