Dow futures surge 410 points: 5 things to know before Wall Street opens

US stock futures rose on Monday after President Donald Trump delayed a planned attack on Iran, pushing oil prices sharply lower and easing immediate inflation concerns.

At about 7:00 AM ET, Dow futures surged 410 points or 0.78%, while S&P 500 and Nasdaq 100 contracts gained 0.56% and 0.41%.

The relief signal was encouraging but fragile across global markets.

Iran denied that direct talks with Washington were under way, manufacturing data could reshape interest-rate expectations, and Palantir’s results will test whether confidence in AI spending has truly recovered after July’s semiconductor sell-off and South Korea’s renewed volatility this week.

5 things to know before Wall Street opens

1. Iran diplomacy lifts futures, but the gap remains

Trump held back a major strike after Gulf allies urged more time for diplomacy, saying talks aimed at reopening the Strait of Hormuz and addressing Iran’s nuclear programme would begin on Monday.

Tehran challenged that account. Iran’s foreign ministry said it was not negotiating directly with the US and that discussions with Oman concerned a temporary safe route for shipping.

Futures are therefore pricing a lower near-term risk of escalation, not a settled agreement.

Any sign that the Oman channel is stalling, or that attacks on shipping are continuing, could quickly return the geopolitical premium to oil.

2. Oil’s slide eases inflation pressure

Brent crude fell about 7% to roughly $83.5 a barrel, while West Texas Intermediate dropped more than 6% to around $79.5.

The move unwound part of July’s war premium and offered relief to airlines, transport groups and consumer-facing companies, while weighing on energy producers.

OPEC+ added to the pressure by agreeing to raise September output by 188,000 barrels a day, completing the planned reversal of 1.65 million barrels a day of voluntary cuts introduced in 2023.

The sell-off may still prove unstable because Hormuz traffic remains disrupted and diplomacy is contested.

3. Manufacturing data could disturb the rates trade

The final S&P Global manufacturing PMI is due before the Institute for Supply Management’s July factory survey at 10 am ET.

The ISM index stood at 53.3 in June, marking a sixth consecutive month of expansion and remaining above the 50 level separating growth from contraction.

A strong report would support cyclical shares but could lift Treasury yields if prices remain elevated.

A weaker reading would help bonds and technology stocks, while reviving concerns about economic momentum.

The prices-paid and new-orders components may therefore matter more than the headline figure.

4. Yen intervention weakens the dollar

The yen traded near 156 to the dollar after the US and Japan confirmed coordinated intervention, pulling it away from the 40-year low near 164 reached last week.

The dollar index slipped below 100, while the 10-year Treasury yield fell towards 4.69% as lower oil reduced inflation anxiety.

That backdrop supports multinational US companies and rate-sensitive technology shares.

Its durability is uncertain. Japan’s policy rate remains far below the Fed’s 3.5% to 3.75% range, and currency strategists doubt intervention alone can reverse the yen’s decline without a narrower interest-rate gap.

5. Palantir and Korean chips test the AI rebound

Palantir reports after the close and has guided for second-quarter revenue of $1.797 billion to $1.801 billion, with adjusted operating income of $1.063 billion to $1.067 billion.

Wall Street expects about 80% revenue growth, making the report a test of whether US commercial and government demand can justify the company’s valuation.

The regional signal is less reassuring. South Korea’s Kospi fell about 5% on Monday after Friday’s record rebound, with Samsung Electronics and SK Hynix dropping roughly 9%.

Marriott and Tyson Foods report before the bell, while reported merger discussions between AstraZeneca and Bristol Myers Squibb have also driven sharp premarket moves.

Neither drugmaker had confirmed an agreement, leaving investors to assess the regulatory and strategic hurdles facing any potential tie-up.