U.S. Stock Futures Slip as Iran Talks Stall and AI Rally Cools

U.S.-Iran Tensions Pressure Futures and Oil Outlook

By 19:37 ET (23:37 GMT) on Monday, S&P 500 Futures were down 0.2% at 40,459.75 points, Nasdaq 100 Futures fell 0.35% to 30,457.75 points, and Dow Jones Futures declined 0.3% to 51,002.0 points. The pullback came as investors reacted to reports from Iranian media that Tehran had halted indirect negotiations with the U.S. and was moving to completely block the Strait of Hormuz.

According to the reports, Iran’s action was linked to anger over Israeli military operations in Lebanon. Market expectations for a comprehensive peace deal have largely faded after the U.S. and Iran exchanged air strikes for the second time in a week on Monday, straining an already tenuous ceasefire and adding to concerns about the economic impact of a prolonged conflict.

U.S. President Donald Trump delivered mixed messages on the status of talks. He told CNBC earlier in the day that he did not care if negotiations were over, but later stated in a social media post that discussions with Iran were continuing at a “rapid pace.” Reuters separately reported that Iran was seeking an interim deal with the United States. Trump also said he had advised Israel not to proceed with a major operation against Hezbollah in Lebanon.

Rising geopolitical risk has contributed to higher oil prices and investor caution, with markets increasingly focused on potential disruptions to energy supply and the broader economic fallout.

Record Highs on Wall Street as AI Trade Moderates

Despite the weaker futures, Wall Street closed Monday at all-time highs, led by technology shares benefiting from AI-related optimism. The S&P 500 rose 0.3% to 7,600.02 points, the NASDAQ Composite gained 0.4% to 27,086.81 points, and the Dow Jones Industrial Average added 0.1% to 51,078.94 points.

Chipmakers were a key driver, with the Philadelphia Semiconductor Index up 1.1% and hovering near record levels. NVIDIA advanced 6.3% after unveiling a range of new AI chips, including a line designed for Microsoft Windows computers. However, the semiconductor sector’s strong gains through May have left it exposed to profit-taking, and momentum appeared to be slowing.

Broader technology shares outside the chip sector mostly retreated, with major names including Tesla, Amazon, Apple, and Alphabet declining between 1% and 5%. Alphabet fell a further 1.3% in aftermarket trade after announcing plans to raise $80 billion in equity offerings, including an investment deal with Berkshire Hathaway.