Stock futures slip as Trump rejects Iran proposal and oil prices jump

U.S. stock futures declined late Sunday, May 10, as President Donald Trump announced his rejection of Iran's latest proposal to resolve the ongoing conflict.

This development also led to an increase in oil prices during overnight trading. Futures linked to the Dow Jones Industrial Average decreased by 143 points, a 0.3% drop. S&P 500 futures and Nasdaq 100 futures each saw a 0.3% decline.

Market Reactions to Geopolitical News

The market movements followed a robust week for U.S. equities. The S&P 500 recorded gains exceeding 2%, while the Nasdaq Composite advanced over 4%.

Both indexes completed their sixth consecutive weekly rise, marking their longest such streak since 2024.

President Trump communicated his rejection of the Iranian proposal via a post on Truth Social, stating it was "TOTALLY UNACCEPTABLE!" The proposal, reportedly presented to U.S. negotiators, aimed to end the conflict and sought the listing of sanctions against Tehran.

Oil futures reacted promptly to Trump's comments. West Texas Intermediate crude for June delivery rose by 3.94% to $99.18 per barrel.

Brent crude for July increased by 3.49% to $104.83 per barrel in overnight trading.

Economic Calendar and Inflation Concerns

The surge in crude prices intensified investor focus on how geopolitical risks might influence inflation and growth expectations.

The upcoming week's economic calendar includes reports on April's consumer and producer price indexes. Markets will closely monitor these for indications of whether elevated energy costs are contributing to broader price pressures.

The U.S. market entered the week building on the previous week's gains. The Dow advanced 0.2% for the week, and both the S&P 500 and Nasdaq closed Friday's session at all-time highs.

Global Market Performance

In Asia-Pacific trading, South Korea's Kospi opened at a new record high, climbing 4.70%, though the small-cap Kosdaq fell 0.30%. Japan's Nikkei 225 saw a marginal decrease, while the Topix gained 0.19%. Australia's S&P/ASX 200 declined by 0.83%.

Mainland China's CSI 300 added 0.58%, but Hong Kong's Hang Seng index slipped 0.48%. Investors in these markets were evaluating data indicating that China's consumer and producer inflation in April rose more than anticipated, driven by higher commodity costs linked to the Middle East conflict.

Investors are expected to continue monitoring developments in U.S.-Iran negotiations alongside this week's inflation data. These factors will provide clues regarding the economic impact of the conflict and the ongoing fluctuations in oil prices.