By US stock futures climbed sharply on Wednesday after signs of possible de-escalation in the Iran conflict.
Dow futures advanced 398 points, while the futures linked to the S&P 500 rose 0.8%, while Nasdaq 100 futures gained 1%.
The optimistic mood came as the investors welcomed reports that Washington had presented Iran with a proposal that could help end hostilities.
President Donald Trump confirmed that the US is currently in negotiations with Tehran and indicated Iranian officials were showing a willingness to reach an agreement.
But caution remains as earlier Iranian officials dismissed any talks with the United States and called it an attempt to manipulate the financial and crude markets.
5 things to know before Wall Street opens
1. Oil prices saw some sharp corrections after optimistic reports around the Middle East conflict.
Brent crude and West Texas Intermediate declined 5% on Wednesday as reduced fears of supply disruptions and pushed traders to unwind part of the conflict-driven premium.
Even after Wednesday’s drop, prices remained elevated versus recent norms, with WTI still above its 50-day moving average of 74.5398 and Brent above its 50-day moving average of 80.9468.
Oil prices has seen some extreme volatility over the past few weeks as Iran blocked the critical Strait of Hormuz after strikes from the US and Israel.
2. Easing tensions in the Middle East also brought good news for the precious metal investors as gold prices saw a healthy rebound on Wednesday.
Gold’s rebound was supported by a weaker US dollar and a sharp pullback in oil prices, factors that eased immediate inflation worries.
Saxo Bank’s Ole Hansen said gold had been sold for cash during the liquidity squeeze, but argued prices could recover further once forced liquidation fades.
Gold was trading near $4,600 an ounce, up about 3.5%.
Silver also advanced, though Hansen said silver remains more vulnerable because of its greater sensitivity to economic concerns.
3. Wall Street economists are raising US recession warnings amid geopolitical risks.
The factors like stubborn inflation and labor-market weakness are exposing the fragilities beneath still-resilient headline data.
Moody’s Analytics lifted its probability of a recession over the next year to 48.6%, while Goldman Sachs put the odds at 30%, Wilmington Trust at 45% and EY Parthenon at 40%.
Those estimates are well above the roughly 20% recession probability considered normal in a typical 12-month period.
4. Arm stock jumped 13% in premarket trading after the chip designer said its in-house processor, the AGI CPU, could generate about $15 billion in annual revenue by 2031.
The company unveiled the data-center chip on Tuesday, positioning it for AI inference workloads.
CEO Rene Haas said Arm expects total annual revenue to reach $25 billion within five years.
He also implied a dramatic increase from the roughly $4 billion it generated in 2025.
Meta is the first customer for the new chip, highlighting Arm’s push to capture a larger share of AI infrastructure spending.
5. The relief of de-escalation in the Iran conflict echoed through global markets on Wednesday, with stocks advancing in both Europe and Asia.
In Europe, the FTSE 100 opened 0.7% higher, Germany’s DAX up 1.16%, France’s CAC 40 up 0.9% and Italy’s FTSE MIB up 1.3%.
Across Asia, Japan’s Nikkei 225 rose 2.5%, the Topix gained 2.4%, and South Korea’s Kospi climbed 2.5%.
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