Wall Street looked set for a positive open, with major index futures in the green. As of 03:33 ET, Dow Jones futures rose 149 points (0.3%), S&P 500 futures added 20 points (0.3%), and Nasdaq 100 futures gained 87 points (0.4%).
The rise comes on the heels of growing optimism among investors. A ceasefire between Israel and Iran, holding steady since early in the week, has eased concerns of wider conflict in the Middle East. Additionally, U.S.-China relations appeared to stabilize, with both sides reportedly reaching an agreement to streamline the export of critical rare earth materials.
There is also speculation that President Donald Trump may extend the current pause on reciprocal tariffs beyond the early July deadline, and even discussions around a possible new Federal Reserve chair with a more dovish stance have fueled market momentum.
The U.S. dollar slid further, nearing a 3.5-year low and heading for its biggest weekly drop in over a month.
PCE Inflation Report in Focus
The main economic event of the day will be the Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation gauge. Markets expect the core annual PCE reading for May to come in at 2.3%, with the monthly figure matching April’s 0.1% pace.
Although the Fed has taken a cautious “wait-and-see” approach recently, policymakers are watching incoming data closely to assess the longer-term impact of tariffs on inflation. So far, evidence of inflationary pressure from tariffs has been limited, but central bankers are expected to remain on hold until data from the summer months offers greater clarity.
Nike Shares Surge After Earnings Beat and Production Strategy Shift
Nike (NYSE:NKE) shares rallied in after-hours trading following the company’s stronger-than-expected fiscal fourth-quarter earnings report.
While revenue fell 12% to $11.1 billion, that was still better than the expected $10.72 billion. Nike also issued a relatively upbeat forecast, projecting only a mid-single-digit decline in first-quarter sales—less severe than analysts’ 7.3% projection.
Nike executives warned that recent tariff policies could add $1 billion in additional costs, particularly since 16% of Nike’s footwear imports to the U.S. still originate in China. However, the company plans to reduce that share to a high-single-digit percentage by May 2026 by relocating more production to the United States.
Despite an 86% drop in net profit to $211 million due to markdowns and inventory clearance, investors responded favorably to the company’s cost-cutting and sourcing shift strategies.
Fed Stress Test Results Expected
The Federal Reserve is also scheduled to release its annual bank stress test results today. Analysts expect all major lenders to pass, indicating sufficient capital buffers to withstand severe economic shocks.
According to Wells Fargo analysts, the outcome could open the door for banks to increase lending, engage in more M&A activity, or return additional capital to shareholders through buybacks and dividends.
The stress test, introduced after the 2008 financial crisis, remains a key tool for regulators in assessing financial stability among the largest U.S. banks.
Oil Prices Edge Higher But Remain Down for the Week
Crude oil prices nudged higher on Friday, although they remain on track for their worst weekly performance in over two years.
As of 03:32 ET, Brent crude rose 0.7% to $67.14 per barrel, while West Texas Intermediate (WTI) gained 0.7% to $65.69 per barrel.
Despite the modest gains, both benchmarks are down roughly 12% for the week. Traders have pared back the geopolitical risk premium after the Israel-Iran ceasefire held firm. A late-week bounce was supported by U.S. government data showing a drawdown in crude and fuel inventories, a sign of steady demand in the world’s largest economy.
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