Dow futures are showing a slight increase as the market anticipates a significant decision from the Federal Reserve regarding monetary policy. Concurrently, media reports are starting to shed light on the specifics of a potential framework for peace in the Middle East. Brent crude futures continue to decline, yet remain above pre-war levels, while SpaceX shares maintain their historic upward trajectory following a successful public debut last week.

Dow futures indicated a general upward trend on Wednesday, as investors prepared for a highly anticipated interest rate decision from the Federal Reserve and looked forward to additional information regarding a preliminary peace agreement between the United States and Iran. The Dow futures contract had risen by 57 points, or 0.1%, S&P 500 futures had gained 25 points, or 0.3%, and Nasdaq 100 futures had climbed by 263 points, or 0.9%. The primary indices exhibited a mixed performance at the conclusion of the prior session. The benchmark S&P 500 and tech-heavy Nasdaq Composite both experienced declines, whereas the blue-chip Dow Jones Industrial Average achieved a new record-high close. Sentiment seemed subdued, as traders paused after a hectic beginning to the week that included the declaration of an interim agreement to conclude the prolonged conflict in the Middle East lasting over three months. Euphoria surrounding the monumental entry of rocket company SpaceX into the public market persisted without interruption, as detailed further below. “[R]elative calm has broken out in markets since the war in the Middle East is now seemingly over,” analysts noted in a morning report.

Today’s agenda will prominently feature the conclusion of a two-day Federal Reserve policy meeting. The central bank is anticipated to maintain interest rates at a range of 3.5% to 3.75%, marking the inaugural policy decision under the leadership of new Chair Kevin Warsh. An appointee of President Donald Trump, Warsh finds himself navigating the tension between the White House’s ongoing desire for substantial rate cuts and the emerging signs of inflationary pressures driven by energy costs that may necessitate increases in borrowing costs. Warsh’s predecessor, Jerome Powell, frequently rebuffed Trump’s demands, drawing the ire of the president and sparking debate around the longstanding independence of the Federal Reserve from political influence. Powell has remained in his position as a Fed governor, referencing legal challenges directed at him and the central bank. With inflation seemingly moderating at the start of the year, there was broad expectation that the Fed would initiate a sequence of rate cuts in 2026. However, the initiation of the joint U.S.-Israeli offensive against Iran in late February, coupled with the ensuing closure of the Strait of Hormuz, triggered an oil shock that ignited concerns regarding a surge in price pressures. Markets will have the opportunity to analyse new quarterly economic projections from Fed officials, which may provide insight into the intensity of the internal debate regarding interest rates. Analysts forecast that the outlook will indicate elevated inflation, a declining unemployment rate, and no rate reductions this year — although they noted that “a few policymakers will likely project hikes.”

A 14-point framework accord between the U.S. and Iran focuses on establishing a permanent ceasefire, which encompasses Lebanon, the removal of an American naval blockade, and the reopening of the Strait of Hormuz, as reported by various media outlets. The agreement would also establish a foundation for discussions regarding Iran’s nuclear program, which are expected to commence following a formal signing ceremony of the deal on Friday, sources indicated. One key provision of the draft includes immediate waivers for Iranian oil and petrochemical exports upon the signing, along with other financial incentives such as the unfreezing of Iranian assets and a roughly $300 billion regional reconstruction plan, sources reported. Tehran would, in turn, commit to refraining from the pursuit of a nuclear weapon and to neutralising its nuclear material. Crucially, as a source noted, the financial relief for Iran seems to be contingent upon the country’s compliance with American demands to eliminate its enriched uranium stockpile and broader nuclear aspirations. Despite these reports, much of the details remain fluid as the signing day approaches, “underscoring that this is still a high-level memorandum of understanding rather than a final settlement,” the analysts noted.

Amidst this context, Brent crude prices continued their multi-day decline, as traders anticipated the re-entry of oil supplies into global markets with the reopening of the Strait of Hormuz. By 03:54, Brent crude futures, the global oil benchmark, had declined by 0.8% to $78.35 a barrel. The contract declined beneath $80 for the first time since March on Tuesday, yet remains elevated above pre-war levels. President Donald Trump has stated that restrictions on ship movements in the waterway off Iran’s southern coast will be lifted on Friday. However, some analysts have indicated that it may take time for energy supply chains to completely recover. Approximately 20% of global oil and liquefied natural gas transited through the strait prior to the commencement of the joint U.S.-Israeli military action against Iran in late February. U.S. forces are persistently engaged in the search for mines that Iran has laid in the strait, a significant challenge that the preliminary agreement may not be equipped to resolve promptly, raising potential apprehensions among shipping companies hesitant to navigate through this critical passage.

SpaceX continued its post-float surge on Tuesday, surpassing Amazon’s market value and briefly overtaking Microsoft’s, quickly climbing the ranks of the world’s most valuable companies. Elon Musk’s reusable rocket company soared 4.83% to $201.80, boosting its market cap to around $2.65 trillion—$8 billion ahead of Amazon. The action builds on an already historic run. SpaceX set the price of its initial public offering at $135 per share on June 12, marking the largest public offering in history and generating an initial capital of $75 billion. Tuesday’s close positions SpaceX approximately 50% above its IPO price within a mere four trading sessions, a trajectory that has unsettled even the most experienced market analysts. In after-hours trading, the stock rose over 2%.