Your premarket brief — what happened overnight, and what's set up for today.
Stocks
US futures are drifting flat to slightly lower this morning after Monday's risk-on rip — the S&P climbed 1.65%, the Nasdaq surged 3.07%, and the Dow added 469 points to close at 51,671 — all powered by the US–Iran peace framework and collapsing oil. Asian markets inched up overnight in a consolidation session after Monday's rally, while Europe is pausing for breath ahead of Wednesday's decision. Tech and consumer discretionary led yesterday's tape, but the real story is what happens when Warsh walks into his first FOMC presser: futures are pricing virtually no chance of a cut and whispers of a hike are creeping into the curve for the first time since 2023. The bid's gone quiet because the next catalyst is sitting in the Board Room.
Macro
The two-day FOMC meeting kicks off today, with the policy statement and Chair Kevin Warsh's first press conference landing Wednesday at 2 p.m. ET. The fed funds rate sits at 3.50% to 3.75% and is widely expected to stay there — elevated inflation and a resilient labor market have killed any urgency for easing, and half the former officials polled think Warsh may have to hike before year-end. The dollar eased and yields dipped Monday on the Iran headline, but the real question is whether Warsh uses his debut to walk back forward guidance entirely, as he's suggested he might. Retail sales for May hit Wednesday morning before the decision, adding one more inflation data point to the mix.
Geopolitics
The US and Iran confirmed a framework agreement to end the Middle East conflict and reopen the Strait of Hormuz, with a formal signing expected in Switzerland on Friday. Markets surged Monday on the headline, but the devil's in the details: Israeli troops remain in southern Lebanon, Netanyahu is pushing back, and Iran's foreign minister says any further strikes violate the understanding. The deal has taken the war premium out of oil and sent airlines and cruise lines soaring, but traders know frameworks aren't final deals. The choppy implementation risk is the next trade.
Commodities
Oil extended losses overnight after Monday's 5% collapse, with Brent last around $83 and WTI holding near $81 as the Hormuz reopening deflates the geopolitical premium that had pushed crude near $100 earlier this month. The Iran deal is stripping out the risk bid, but the real question is how long Hormuz flows take to normalize — estimates run to months even if the deal closes Friday. Gold eased to around $4,368 after touching record highs in recent weeks, still up 0.38% as macro uncertainty keeps haven demand alive. Silver ticked up to $70.54. Natural gas is quiet, and ag markets are steady with no major weather headlines. The energy trade has flipped from war premium to normalization, but the path back to full Gulf flows is longer than the headline suggests.
On Deck Today
- FOMC meeting begins (day one of two), with the policy decision and Warsh presser landing Wednesday at 2 p.m. ET.
- Retail sales for May (Wednesday, 8:30 a.m. ET) — the last inflation read before the Fed decides.
- US–Iran framework implementation watch — any headlines on Israeli troop movements or Hormuz shipping could move oil intraday.