Dow Futures indicate an upward trajectory, supported by optimism surrounding a potential peace agreement between the U.S. and Iran. Media reports indicate that Washington and Tehran have reached a preliminary agreement, yet statements from both parties seem to mitigate expectations regarding the imminent announcement of a comprehensive accord. Oil prices decline and the dollar weakens, while gold experiences an increase.

Dow futures experienced a notable increase on Monday, as investors responded positively to indications of a possible resolution in the negotiations aimed at concluding the conflict in Iran. By 03:44, the index had jumped by 399 points, or 0.8%, the other index climbed by 70 points, or 0.9%, and yet another had surged by 407 points, or 1.4%. Stocks in Asia and Europe have experienced a rally, though liquidity is expected to be limited as the primary averages on Wall Street are scheduled to remain closed today in observance of Memorial Day. U.S. stock markets are set to resume operations on Tuesday. In the wake of extensive diplomatic negotiations aimed at reaching an accord between the U.S. and Iran, certain analysts propose that market valuations may have already incorporated expectations of peace, which could mitigate the potential effects of any forthcoming agreement. The likelihood of a significant, widespread relief rally contingent upon the re-opening of the Strait of Hormuz has likely decreased over time, although certain markets exhibit greater potential for upside than others,” analysts noted. Elsewhere, increased by a full point. There will be no cash trading on Monday. Last week, the 30-year yield, a measure frequently employed to assess geopolitical and economic risk sentiment, briefly increased to its highest level since 2007. Yields typically exhibit an inverse relationship with prices.

Washington and Tehran have reached a preliminary agreement regarding the resolution of their conflict, which has persisted for over two months, according to reports from various news outlets that reference a senior official from the White House. Crucially, the agreement would encompass the reopening of the Strait of Hormuz, a critical waterway located off Iran’s southern coast, through which approximately one-fifth of the global oil supply transits. The strait has effectively been closed to tanker traffic for weeks, leading to an increase in oil prices and heightening concerns about a surge in inflation across various countries globally. However, Iran sought to dispel speculation regarding an impending deal. Both parties have established a framework aimed at resolving the conflict; however, a prospective memorandum of understanding lacks detailed provisions regarding the administration of the Strait of Hormuz, as stated by a spokesperson from the Iranian foreign ministry on Monday, according to reports. In a recent social media post, U.S. President Donald Trump indicated that he had instructed his representatives “not to rush into a deal,” emphasising that an American blockade on Iranian ports would remain in place until an agreement is “reached, certified, and signed.

Yet the weekend reports were sufficient to trigger a significant decline in oil prices, potentially offering some respite for traders concerned about a surge of energy-driven inflation in various countries globally. Brent crude futures, the global oil benchmark, experienced a decline of 4.7%, trading at $95.54 per barrel. Despite slipping below recent highs exceeding $100 a barrel, Brent’s price continues to be significantly elevated compared to its levels before the onset of the conflict in late February. We have encountered this phase previously, only for discussions to collapse. Consequently, analysts indicated in a note that the market is expected to exercise greater caution in its reactions to these headlines. Strategists have cautioned that, even in the event of an accord, oil prices are unlikely to revert to pre-war levels. This situation is indicative of a heightened geopolitical risk premium and the ramifications of the conflict on global energy supply chains. With the prospect of a prolonged energy price spike fuelling fears of inflation, expectations have increased that central banks in both developed and emerging economies will respond by raising interest rates. The U.S. Federal Reserve is now expected to increase borrowing costs by 25 basis points in January 2027, contrasting with earlier expectations for a series of rate cuts prior to the war.

Projections indicating that rates will persist at elevated levels for an extended period constrained the potential for an increase in. By 04:25, it had risen by 1.0% to $4,555.21 an ounce, yet remains significantly below pre-war levels. Bullion, a non-yielding asset, is generally regarded as an underperformer in an environment of elevated interest rates. Concurrently, the U.S. dollar has been perceived as a relatively secure investment haven, partly due to the conviction in certain sectors that the U.S. — a significant energy exporter — will possess the economic resilience to endure an energy shock instigated by the conflict. A firmer dollar can diminish some of gold’s allure by increasing the cost of the yellow metal for international purchasers. The index, which measures the performance of the greenback against a basket of currency peers, was last observed trading down by 0.2% at 99.02.

Delivery Hero shares attained their peak in 18 months on Monday following the announcement from the German food delivery firm regarding an indicative offer from Uber. A report from the Financial Times indicated that the U.S. company might consider raising its bid. The stock traded 9.7% higher at 36.85 euros per share at 08:15, marking its strongest level since late November 2024. The rally valued Delivery Hero at 11.2 billion euros ($13.04 billion). As reported that Uber is considering a higher offer for Delivery Hero after a major shareholder rejected a bid valuing the company at more than 11.5 billion euros ($13.4 billion). In recent days, Uber made an offer of 38 euros per share to one of Delivery Hero’s largest shareholders, which was subsequently declined. Several Delivery Hero shareholders are advocating for a valuation exceeding 40 euros per share for the entire company, according to the report.