FX.co ★ US Futures Drop on Mideast Escalations

US stock futures declined on Monday as tensions between Washington and Tehran escalated over the weekend, following renewed disruptions in the Strait of Hormuz. Dow futures fell nearly 1%, while S&P 500 and Nasdaq 100 futures were down 0.8% and 0.6%, respectively.

President Donald Trump said the US Navy fired on and seized an Iranian-flagged cargo vessel in the Gulf of Oman after it ignored orders to stop while departing the Strait of Hormuz. In response, Tehran targeted ships and reversed earlier plans to reopen the waterway after the US refused to lift its blockade on Iranian ports.

Optimism that had begun to build late last week has since faded, despite Trump indicating that US negotiators would travel to Pakistan on Monday for further talks. Even so, equities posted strong gains last week: the S&P 500 and Nasdaq Composite advanced 4.54% and 6.84%, respectively, both closing at fresh record highs, while the Dow rose 3.19% to secure a third consecutive weekly increase.