U.S. stock futures are signaling a positive opening for markets on Tuesday, suggesting equities may build on the rebound recorded in the previous session.
The expected gains come as investors try to move past recent swings in crude oil prices tied to the escalating tensions in the Middle East.
Crude oil for April delivery is currently rising more than 2 percent after dropping by over 5 percent during Monday’s trading.
The latest increase in oil prices follows a wave of Iranian attacks on the United Arab Emirates, reportedly targeting Dubai International Airport and the Fujairah oil port in what marks a major escalation in the conflict.
A drone strike caused a fire at the Fujairah Oil Industry Zone in the UAE, although reports indicate that no casualties were recorded. The facility is located roughly 93 miles east of Dubai.
Reports of loud explosions and air defense activity emerged across the UAE, Saudi Arabia and Qatar as the U.S.-Israel conflict with Iran entered its eighteenth day.
The Israeli military said it had launched a “wide-scale wave of strikes” across Iran’s capital and was also intensifying operations against Iran-backed Hezbollah targets in Lebanon.
At the same time, several U.S. allies—including Germany, Spain, Italy, Australia and Japan—have declined President Donald Trump’s request to assist in securing the Strait of Hormuz, a critical passage for roughly one-fifth of the world’s energy shipments.
After trending lower over several sessions, U.S. stocks posted a strong recovery on Monday. All three major indexes ended the day higher, led by gains in technology shares.
The benchmarks closed below their intraday peaks but still recorded solid advances. The Nasdaq jumped 268.82 points, or 1.2 percent, to 22,374.18, the S&P 500 climbed 67.19 points, or 1.0 percent, to 6,699.38, and the Dow Jones Industrial Average rose 387.94 points, or 0.8 percent, to 46,946.41.
Monday’s rally coincided with a steep drop in oil prices, with crude for April delivery falling nearly 5 percent after having surged 8.6 percent last week.
Oil prices retreated after President Donald Trump urged other countries to help protect the Strait of Hormuz.
“I’m demanding that these countries come in and protect their own territory, because it is their territory. It’s the place from which they get their energy,” Trump told reporters aboard Air Force One on Sunday. “And they should come and they should help us protect it.”
“Why are we maintaining the Hormuz Strait when it’s really there for China and many other countries?” he asked. “Why aren’t they doing it?”
The decline in oil prices helped ease some of the market’s recent inflation concerns, although the Federal Reserve is still widely expected to keep interest rates unchanged at its upcoming meeting.
Value buying may also have supported the market’s recovery after the major averages closed at their lowest levels in more than three months last Friday.
On the economic front, a report from the Federal Reserve showed U.S. industrial production rose slightly more than anticipated in February.
The Fed said industrial production increased by 0.2 percent in February after a 0.7 percent gain in January. Economists had forecast a more modest increase of 0.1 percent.
Computer hardware companies were among the session’s top performers, with the NYSE Arca Computer Hardware Index advancing 2.6 percent.
Networking and semiconductor stocks also posted strong gains, contributing to the broader rally in the technology-heavy Nasdaq.
Outside the tech sector, steel stocks also moved higher, pushing the NYSE Arca Steel Index up by 1.7 percent.
Airline, brokerage and housing stocks also recorded notable gains, rising alongside most other major sectors.
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