By Niket Nishant and Avinash P
June 29 (Reuters) – U.S. stock index futures rose on Monday, led by strong gains in the tech-heavy Nasdaq 100, as easing tensions in the Middle East lifted sentiment, while Comcast shares soared on plans to split into two companies.
A U.S. official said on Sunday that the United States and Iran will de-escalate following days of hostilities, bolstering hopes that an interim peace deal signed earlier this month could hold.
While diplomatic efforts to put an end to the conflict have calmed investors, caustic rhetoric and occasional flare-ups in the region have at times raised the risk of a broader escalation that could push oil prices higher.
“Predictably, the overtures made by the U.S. and Iran have reversed significantly just before market open once again, with both sides suggesting they’ll wind down strikes ahead of the next round of talks,” said Kyle Rodda, senior financial market analyst at Capital.com.
“Such overt efforts to lower oil prices and boost stocks by the Trump administration are supporting hopes that it’ll do whatever is necessary to get a deal done.”
At 07:03 a.m. ET, U.S. S&P 500 E-minis were up 67 points, or 0.91%, and the Nasdaq 100 E-minis were up 375.5 points, or 1.28%.
Dow E-minis were up 265 points, or 0.51%. The blue-chip index held up better than the other Wall Street benchmarks last week, gaining 0.6%.
Meanwhile, RBC Capital Markets raised its 12-month target for the S&P 500 index to 8,150 from 7,900, citing earnings strength and favorable market conditions as factors likely to push U.S. equities higher.
AI WORRIES COMPLICATE OUTLOOK
Concerns about AI spending have injected an additional dose of uncertainty into the market. A selloff last week punished investor favorites such as semiconductors and the so-called Magnificent Seven.
Apple’s shares were underperforming their Magnificent Seven peers in premarket trading on Monday, following a 4.8% drop last week.
The company raised iPad and MacBook prices on Thursday, saying it could no longer shield customers from soaring memory and storage chip costs driven by the AI industry’s data center buildout.
“If consumer demand softens in response, the volumes underpinning record chip margins look increasingly fragile — feeding back into earnings growth skepticism,” said Fabien Yip, market analyst at IG.
Traders are also expecting at least one rate hike by the Federal Reserve this year to keep inflation under control. They would likely reassess those bets later this week, when the U.S. releases the jobs data for June.
In the premarket session, Comcast gained 19.6% after the media and cable provider said it plans to separate into two independent publicly traded companies through a tax-free spinoff of NBCUniversal and Sky.
SpaceX also rose 2.1% after Nasdaq said the newly listed company will be added to the Nasdaq 100 index on July 7.
Shares of Viridian Therapeutics jumped 14.5% after the U.S. Food and Drug Administration approved its drug to treat patients with thyroid eye disease.
(Reporting by Niket Nishant and Avinash P in Bengaluru; Editing by Shinjini Ganguli)
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