Trump says Israel, Iran agree to ceasefire
President Donald Trump says Israel and Iran agreed to a cease-fire after Iran retaliated for U.S. strikes on three nuclear facilities.
U.S. stock futures jump after President Donald Trump announced a Middle East ceasefire, but Israel has already accused Iran of violating the agreement.
Trump outlined in a social media post a timeline for the ceasefire between Israel and Iran that would have begun around midnight Eastern time. But within hours, Israel said it detected a missile launch from Iran. Iran denied firing missiles at Israel after the ceasefire came into force.
Trump demanded in a social media post that Israel stop dropping bombs to save the truce. He later told reporters he thought both sides had broken the ceasefire, but still believes the truce will hold.
At 7:11 a.m. ET, futures linked to the blue-chip Dow rose 0.69%, or 298 points, to 43,199; broad S&P 500 futures added 0.79%, or 48.25 points, to 6,125.25; and tech-heavy Nasdaq futures gained 0.99%, or 219 points, to 22,292.50.
Oil prices, which recently had risen on fears the Israel-Iran conflict would escalate and spread through the region, fell further, taking more weight off stocks. U.S. oil was last down 2.79% at $66.60 per barrel.
“From a market standpoint, this situation remains all about oil and as long as the flow of the 20 million barrels per day out of the Gulf is not materially disrupted, then oil prices are not likely to sustainably rise and this situation will not dramatically impact U.S. markets,” said Tom Essaye, founder of the Sevens Report.
Stocks had already rallied as oil prices declined during the day after Iran tried but failed to strike a U.S. military base in Qatar. Qatar intercepted the missles.
“Iran offered a warning and launched a scripted missile attack of little consequence,” said Mike O’Rourke, chief market strategist at JonesTrading.
Federal Reserve Chair Powell set to talk
With Mideast tensions easing, investors will turn to Federal Reserve Chairman Jerome Powell’s two-day testimony before Congress on the economy.
In the last week, some Fed members have said they are open to rate cuts. Fed Governor Michelle Bowman signaled support for a potential rate cut as soon as July. She said risks to the labor market could rise, but inflation appears to be still headed toward the Fed’s 2% goal.
Her comments echoed those of Fed Governor Christopher Waller last week. He suggested the central bank could lower interest rates as soon as next month because he believes inflation from tariffs is likely to be short-lived.
Chicago Fed President Austan Goolsbee has said the Fed could resume rate cuts if the inflation from tariffs remains subdued but didn’t offer a timeframe for a potential rate cut.
Lower rates reduce the cost of borrowing, which usually encourages spendng. More spending is seen as a boost for the economy and the stock market. Trump has been hounding Powell to lower rates immediately.
Corporate news
- KB Home topped second-quarter quarterly estimates but lowered its full-year housing revenues guidance. Shares fell 1.33% in pre-market trade.
- Chewy said it plans to sell $1 billion of its Class A common stock through JPMorgan. It also announced a $100 million share repurchase program. Shares of the pet retailer slipped 1.61% before the opening bell.
Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at [email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.
