【US Pre-Market】Three Major Index Futures Rise as Oil Slump Boosts Tech and Airline Stocks; AMD, Micron Up About 2%

TradingKey - On Monday Eastern Time, the three major US stock index futures rose collectively in premarket trading. The weekend halt in mutual attacks between the US and Iran pushed international oil prices down sharply, easing market worries over energy-driven inflation and further policy tightening by the Federal Reserve, which led capital to flow back into tech stocks and oil-sensitive sectors such as airlines and cruise lines. Investors are also awaiting this week's Fed interest rate decision and earnings reports from several tech giants.

As of press time, Dow futures rose 1.1%, S&P 500 futures rose 0.88%, and Nasdaq 100 futures rose 1.36%.

Performance of the three major US stock index futures, Source: Investing

In commodities, international oil prices plunged in premarket trading, while gold prices rebounded. WTI ( USOIL) crude fell about 8%, dropping back to around $83.5; Brent crude ( UKOIL) fell about 13%, trading around $85.9; gold ( XAUUSD) rose about 1.2% to around $4,103. The US suspended military action against Iran, and Iran also put retaliatory strikes on hold, reducing market pricing of risks related to further escalation in the Middle East conflict and supply disruptions in the Strait of Hormuz. However, vessel traffic through the Strait of Hormuz remains low, and energy facilities along the Red Sea coast still face risks of attacks by Houthi militants.

In cryptocurrencies, Bitcoin ( BTC) rose about 0.9%, trading around $65,200. The temporary easing of tensions in the Middle East drove a rebound in risk assets, with Ethereum rising nearly 2% over the same period. However, the overall crypto market remains volatile ahead of the Fed meeting and the release of US inflation data.

Market Movers

Semiconductor stocks rebounded across the board in premarket trading. AMD ( AMD) rose about 2%, Micron Technology ( MU) rose 1.2%, Intel ( INTC) rose about 0.6%. Nvidia ( NVDA) rose about 0.6%. Semiconductor equipment stocks performed even stronger, with Applied Materials ( AMAT) rose over 4%, Lam Research ( LRCX) rose 3.4%. A pullback in oil prices and U.S. Treasury yields prompted capital to flow back into the previously sold-off AI hardware sector.

Airline and cruise stocks rose in premarket trading. Southwest Airlines ( LUV) rose 3.1%, United Airlines ( UAL) rose 3.5%, Delta Air Lines ( DAL) and American Airlines ( AAL) both recorded notable gains. Royal Caribbean ( RCL) and Carnival ( CCL) rose about 3%. Falling oil prices help lower aviation fuel costs and improve earnings expectations for the consumer travel sector.

Energy stocks fell across the board in premarket trading. Devon Energy ( DVN) fell over 4%, Occidental Petroleum ( OXY) fell nearly 4%, ExxonMobil ( XOM) fell over 2%. International oil prices quickly gave back their geopolitical risk premium, directly weighing on the share prices of upstream oil and gas companies.

Most megacap tech stocks rose. Microsoft ( MSFT) rose about 1.5%, Meta Platforms ( META) rose nearly 2%, Amazon ( AMZN) rose over 1%, Apple ( AAPL) rose slightly. Tech giants will report their earnings in quick succession this week, with AI revenue growth, cloud computing demand, and capital expenditure plans being the key focus of the market.

Market Highlights

The United States and Iran have suspended mutual attacks. The US suspended military operations against Iran over the weekend, and Iran stated that as long as the US does not launch further attacks, it will also cease retaliatory actions. Despite the temporary ceasefire between the two sides, shipping volumes in the Strait of Hormuz remain low, and Yemen's Houthi rebels have recently continued to attack oil facilities along Saudi Arabia's Red Sea coast.

The Federal Reserve will begin its two-day monetary policy meeting on Tuesday and announce its interest rate decision on Wednesday. LSEG data shows that the market expects the Fed to raise rates by at least 25 basis points this year, with the probability of a rate hike this week at approximately 31%.

Apple, Microsoft, Amazon, and Meta will report quarterly results this week. The market will focus closely on AI infrastructure spending, cloud business growth rates, profit margins, and management's guidance on demand for the second half of the year.

Key Data and Events Preview

At 8:30 AM Eastern Time on July 27, the US will release June durable goods orders. The market expects headline orders to grow by 1.6% month-on-month, compared to a 4.5% decline previously; core durable goods orders are expected to increase by 0.9%, compared to a 1.3% increase previously.

At 10:30 AM Eastern Time on July 27, the US will release the July Dallas Fed Manufacturing Index, with a previous reading of 0.