DATA & FIGURES

S&P futures are 0.5% higher, while Nasdaq futures are up 1%. The Stoxx 600 is little changed at 641.78, and Brent crude is down 0.3% on an $87/bbl handle. The Bloomberg Dollar Spot Index has been choppy but ultimately flat, with the greenback mixed versus G10 peers. Spot gold is up 0.1%, while silver rises 1.5%. Bitcoin has been on the back foot, down 0.5%.

THE SCENARIO

The US-Iran conflict has escalated, with renewed hostilities disrupting energy flows through the Strait of Hormuz. The economic calendar is sparse, but earnings reports will test whether company results can match high expectations. Investors are optimistic about a potential resolution to the conflict, with Joachim Klement, head of strategy at Panmure Liberum, stating that investors still think the US and Iran will go back to the negotiation table.

DIRECT QUOTE

"Only once the US is no longer willing to negotiate do we expect markets to price higher oil prices for longer... The sentiment among investors remains positively biased, despite the setbacks in the tech space last week." — Joachim Klement, Head of Strategy at Panmure Liberum

BBN INSIGHT

The Positive Side: The rebound in US futures suggests that investors are optimistic about a potential resolution to the US-Iran conflict. The hyperscaler earnings reports are expected to drive market sentiment, with Alphabet kicking off quarterly earnings from AI hyperscalers on Wednesday. The Negative Side: The conflict has already disrupted energy flows, with US gasoline pump prices crossing the $4 a gallon mark. The market is also facing pressure from high expectations, with Andrea Gabellone, head of global equities at KBC Securities, stating that this week's earnings reports will be crucial in calming the market.

MARKET REACTION

The market has reacted positively to the news, with S&P futures rising 0.5% and Nasdaq futures climbing 1%. The Stoxx 600 is little changed at 641.78, and Brent crude is down 0.3% on an $87/bbl handle. The Bloomberg Dollar Spot Index has been choppy but ultimately flat, with the greenback mixed versus G10 peers.