Futures associated with the primary U.S. stock indices experienced an uptick on Thursday, as the endorsement of an interim Middle East peace agreement alleviated certain concerns regarding a hawkish perspective from the Federal Reserve. By 05:55, the Dow futures contract had risen by 305 points, or 0.6%, S&P 500 futures had gained 70 points or 0.9%, and Nasdaq 100 futures had jumped by 486 points, or 1.6%. The primary indices on Wall Street experienced a decline in the previous session, impacted by a rise in U.S. government bond yields subsequent to the Federal Reserve’s decision to maintain interest rates at their current levels. Crucially, the latest dot plot of rate projections indicated that several central bank officials anticipate at least one hike in 2026, in contrast to the absence of such predictions in the prior forecasts released in March. Simultaneously, new Chair Kevin Warsh’s inaugural meeting at the helm presented a significantly condensed policy statement that concentrated on addressing inflation, with no reference to the Fed’s additional mandate of promoting maximum employment. There were also indications of forthcoming changes in the Federal Reserve’s approach to various aspects, including communications and data sourcing, prompting analysts to speculate whether future signals from policymakers will be less explicit. “[I]t seems clear there will be a lot less hand-holding than before when it comes to guidance to markets,” analysts remarked in a note.

The U.S. and Iran have entered into a preliminary agreement aimed at concluding their conflict and facilitating the reopening of the Strait of Hormuz. Concurrently, discussions regarding Tehran’s nuclear aspirations are scheduled to commence later this week. U.S. President Donald Trump executed the memorandum of understanding with Iran during a dinner at France’s Versailles palace on Wednesday, as reported by various media outlets and evidenced by a video shared on social media by French President Emmanuel Macron. However, Trump cautioned that assaults on Iran might resume. Speaking to reporters as he departed the dinner, Trump, who had attended a Group of Seven summit in France, confirmed that the deal had been signed. The decision came as a surprise, particularly since a formal signing ceremony involving representatives from the U.S. and Iran was scheduled to occur in Switzerland on Friday. The status of that ceremony is currently ambiguous. The document was also signed by Iranian President Masoud Pezeshkian on behalf of Tehran, as depicted in an image from the state-run IRNA news agency. Separate reports indicated that the agreement had been electronically signed by leaders from both sides.

White House officials have not yet disclosed the complete text of the memorandum of understanding, resulting in a lack of clarity regarding many of its specifics. However, U.S. officials did dictate the draft agreement to journalists, as reported, noting that a text published by the Iranians largely aligns with what the U.S. has articulated. In addition to halting hostilities and initiating nuclear discussions, the agreement would facilitate the reopening of the Strait of Hormuz, a crucial passageway for approximately one-fifth of global oil and liquefied natural gas, which has been largely closed for several months. Oil prices have surged as a result, sparking fears of a wave of global inflation. The agreement would unblock the strait without tolls for two months; however, it does not eliminate the possibility of fees being imposed in the future, according to the source. The U.S. would subsequently waive certain sanctions on Iran, the news agency added. Brent crude futures, the global oil benchmark, declined following the signing. The contract is significantly elevated compared to pre-war levels; however, it has experienced a notable decline from the highs reached earlier in the conflict.

Concerns have proliferated that an inflationary surge driven by energy prices may compel central banks, such as the Fed, to implement elevated interest rates as a countermeasure. In premarket trading, the decline in oil prices has positively influenced stocks perceived as vulnerable to increased fuel expenses, such as airlines like United Airlines and Delta Air Lines. Cruise operators Royal Caribbean and Carnival Corp experienced an uptick in their performance. Shares of Intel surged following Trump’s announcement that iPhone-maker Apple had consented to collaborate with the semiconductor company to design and manufacture chips domestically. Other chipmakers, including Nvidia, Advanced Micro Devices, and Broadcom, also experienced gains. Apple, meanwhile, experienced an uptick following CEO Tim Cook’s announcement that the company would need to increase prices to address a rise in memory and storage-chip costs. Gun maker Smith & Wesson experienced a significant rise in its shares following the announcement of a 27% increase in quarterly revenue.