U.S. equity futures pointed lower at the start of the week, as concerns over a potential naval blockade of the Strait of Hormuz and stalled talks between Washington and Tehran dampened investor sentiment. Oil prices climbed back above $100 per barrel, with markets questioning how long the fragile U.S.-Iran ceasefire can hold. Attention is also turning to upcoming earnings from Goldman Sachs (NYSE:GS), which will help kick off the U.S. reporting season, alongside results from LVMH (EU:MC).
Futures point to a weaker open
U.S. stock futures declined on Monday as investors weighed renewed geopolitical risks after President Donald Trump warned of a possible blockade of the Strait of Hormuz following unsuccessful weekend negotiations with Iran.
At 03:28 ET, Dow futures were down 239 points, or 0.5%, S&P 500 futures fell 40 points, or 0.6%, and Nasdaq 100 futures dropped 168 points, or 0.7%. European and Asian markets also traded unevenly, while oil prices surged and the dollar strengthened.
Wall Street had finished Friday on a mixed note, as investors remained cautious ahead of the high-stakes discussions in Pakistan. A temporary two-week ceasefire was agreed last week, but doubts remain over whether it can evolve into a lasting peace.
Traders are also digesting inflation data showing a sharp rise in consumer prices in March, driven largely by higher gasoline costs tied to the energy shock from the conflict. Oil has rallied since late February, when tensions escalated and tanker movements through the Strait of Hormuz—responsible for roughly one-fifth of global oil flows—were severely disrupted.
Trump signals move on Hormuz
On Sunday, Trump said the U.S. Navy would impose an “immediate” blockade of the Strait to restrict shipping.
He warned that vessels paying tolls imposed by Tehran would not be assured “safe passage on the high seas.”
The Pentagon later clarified that restrictions would apply to ships “entering or departing Iranian ports or coastal areas,” while other vessels would still be permitted to pass through the Strait.
The announcement follows 21 hours of talks between U.S. and Iranian officials in Pakistan, which ended without an agreement to extend the ceasefire. Vice President JD Vance, who led the U.S. delegation, said Iran had rejected demands to curb its nuclear program. Tehran has yet to respond publicly, while Pakistan—acting as mediator—urged both sides to “uphold their commitment to ceasefire.”
Oil reclaims $100 level
Crude prices surged again on Monday, pushing back above the $100 threshold.
Brent crude rose 6.7% to $101.65, while U.S. West Texas Intermediate gained 7.1% to $103.42.
Despite the rally, analysts at Pepperstone described the market response as “relatively contained,” suggesting investors see the blockade as part of a negotiating strategy.
“While it’s clearly a risk-averse start to the trading week, […] the general market reaction can be summed up as ‘could be worse’,” said Michael Brown, Senior Research Strategist at Pepperstone.
Oil had slipped below $100 last week following the ceasefire announcement, which came after Trump warned Iran’s “civilization” could be destroyed if the Strait remained closed. Even so, prices remain elevated compared to pre-conflict levels.
Goldman Sachs earnings ahead
Focus now shifts to results from major U.S. banks, starting with Goldman Sachs ahead of the opening bell.
Shares in Goldman have risen about 3% year-to-date, supported by strong trading volumes as investors reposition portfolios amid the rise of artificial intelligence. Its investment banking division has also shown resilience.
However, the conflict in Iran could overshadow the results. While market volatility can boost trading income, persistently high commodity prices may discourage companies from pursuing large deals such as mergers and acquisitions, potentially weighing on advisory revenues.
Other major banks reporting this week include JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), Citigroup (NYSE:C), Bank of America (NYSE:BAC) and Morgan Stanley (NYSE:MS).
LVMH to report
LVMH (EU:MC), the world’s largest luxury goods company and owner of brands such as Louis Vuitton and Dior, is set to release first-quarter sales later today, with the Middle East conflict likely to influence its outlook.
According to Reuters, luxury sales in hubs such as Dubai and Abu Dhabi have weakened due to the conflict, affecting companies like LVMH as well as rivals including Kering SA (EU:KER) and Hermès (EU:RMS).
At Dubai’s Mall of the Emirates, luxury sales reportedly dropped by as much as 50% in March, while footfall at Dubai Mall fell by a similar margin. In Abu Dhabi’s Galleria mall, overall sales declined by around 10%.
Although the Middle East accounts for a relatively small share of LVMH’s revenue, analysts cited by Reuters believe the impact on profitability—reported on a half-year basis—could be more pronounced.
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