Futures Surge 1% as Trump Willing to End Iran War With Hormuz Closed, Oil Drops, Gas Hits $4, Nike Earnings Today, Nasdaq Fast-Tracks IPOs

The biggest shift in the Iran narrative since the war began. The Wall Street Journal reported late Monday that President Trump told aides he is willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed — a dramatic reversal from his weekend threat to “completely obliterate” Iran’s energy infrastructure. The report sent S&P 500 futures surging more than 1% in overnight trading as investors priced a de-escalation scenario that, just 24 hours ago, seemed impossible.

There is a catch, and it is enormous: if the strait stays shut, roughly 20% of global oil trade stays bottlenecked. Brent crude is falling on the ceasefire signal, but the structural supply disruption does not disappear with a peace deal. JPMorgan’s Natasha Kaneva wrote this week that the oil shortage is rolling westward “much like COVID” — Asia is already rationing, Europe gets hit by mid-April, and the U.S. follows by late April. A ceasefire with a closed strait would end the shooting but not the squeeze.

Meanwhile, the average gallon of gasoline climbed above $4 for the first time since 2022, adding another data point to the consumer inflation story. And the Nasdaq announced it is slashing the time for mega-cap IPOs to enter the Nasdaq 100 index from three months to just 15 trading days — clearing a path for SpaceX, which is expected to list at a $1.75 trillion valuation, and OpenAI to be immediately index-eligible.

Pre-Market Snapshot

The Overnight Catalyst: Trump Ready to End the War

The Wall Street Journal reported Monday evening that Trump told senior advisers he is prepared to end the Iran campaign even if the Strait of Hormuz remains largely closed, potentially leaving the complex operation to reopen it for a later date. The Journal described it as a willingness to accept an outcome short of the unconditional reopening he had demanded just hours earlier on Truth Social.

Simultaneously, Defense Secretary Pete Hegseth held a press conference revealing that the number of Iranian missiles and drones launched has fallen to its lowest level since the war began. Hegseth disclosed he had made a secret trip to the Middle East in recent days to meet with troops and air crews. He spoke alongside Gen. Dan Caine, the chairman of the Joint Chiefs of Staff.

Separately, the U.S. military hit a large ammunition depot in the Iranian city of Isfahan with 2,000-pound bunker buster bombs, while the United Arab Emirates suffered one of the most intense days of Iranian attacks since the first week of the war. A Kuwaiti oil tanker was struck near Dubai, causing a fire but no injuries. And the Iranian parliament approved a plan to collect tolls on vessels traveling through the Strait of Hormuz — a formalization of the de facto blockade as a revenue mechanism.

Global Markets

European markets are rallying on the peace signal. The Stoxx Europe 600 is up 0.96% to 586.33, with broad-based gains across cyclical sectors. The FTSE 100 surged 1.61% to 10,128, boosted by oil majors pulling back from recent highs and a broad risk-on rotation. Eurozone inflation expectations are rising, however — the European Commission’s March survey showed that consumers expect prices on everything from cars to tea to rise this year, and businesses said they are likely to raise prices. The ECB is watching closely for signs that energy price increases are spilling into the broader economy.

Asian markets were mixed. China’s Shanghai Composite fell 0.80% to 3,891.86 as the war-end signal came too late for the Asian session. Japan’s Nikkei was closed for a holiday. The dollar rose 3% in March, its best month since September 2022, while the euro fell 2% in its worst quarter since 2022.

What’s Moving: Oil’s “COVID Moment”

The Axios Markets newsletter published a striking piece Tuesday morning comparing the oil disruption to the pandemic. “The oil shortage brought on by the Iran war will spread throughout the world, much as COVID-19 did, moving from east to west and leaving a path of destruction in its wake,” the analysis stated, drawing on JPMorgan research.

JPMorgan’s Kaneva explained that the shock “unfolds sequentially rather than simultaneously — a rolling supply disruption moving westward, dictated by shipping times and buffered unevenly by regional inventories.” The timeline: Persian Gulf cargoes reach Asia in 10–20 days, Europe and Africa in 20–35 days, and the U.S. Gulf Coast in 35–45 days. That means the American consumer is last in line to feel the squeeze — but the pain is coming.

Despite the peace signal, Brent has gained roughly 55% in March — still the biggest monthly oil spike on record. WTI settled above $100 yesterday for the first time since the war began. Gasoline hit $4 per gallon nationally, and diesel remains above $5 in multiple states.

Aluminum at Four-Year Highs

Aluminum prices hit a four-year high after Iran’s Revolutionary Guard attacks on the Middle East’s two largest producers — Emirates Global Aluminium in the UAE and Aluminium Bahrain (Alba). Tariffs had already been pushing aluminum prices higher, and the war damage compounds the supply problem. Gulf-region producers account for approximately 9% of global aluminum supply and have been unable to ship since the conflict began. ING commodities strategists wrote that the attacks “increase the odds that supplies will be disrupted even if the conflict eases.”

Bond Yields Ease on Powell Signal

The 10-year Treasury yield fell to 4.315% premarket — a continuation of yesterday’s decline after Fed Chair Powell threw cold water on rate hike expectations at Harvard. Powell said: “Energy shocks have tended to come and go pretty quickly. Monetary policy works with long and variable lags, famously, and so by the time the effects of tightening take effect, the oil price shock is probably long gone.”

That is the textbook central banking playbook for supply-side shocks: look through them. Rate hike odds collapsed from 50% to 2.2% after the speech. The 2-year yield fell below 3.9%. Bonds are rallying as the market prices out tightening risk — a powerful tailwind for growth stocks and duration-sensitive assets.

Today’s Economic Data & Events

Premarket Movers & Corporate News

Nasdaq Slashes IPO Index Wait to 15 Days

The Nasdaq announced it will shorten the eligibility period for newly listed, large-cap companies to enter the Nasdaq 100 index from three months to just 15 trading days, effective May 1. The clearest beneficiaries are SpaceX and OpenAI — both expected to come to market with potential trillion-dollar valuations. More than $600 billion in ETFs are linked to the Nasdaq 100. The change means massive forced buying from index funds within weeks of listing rather than months.

Unilever-McCormick Merger Talks

UK consumer goods giant Unilever is in advanced talks to combine its food business with seasonings company McCormick in a cash-and-stock deal that would create a $60 billion enterprise including debt. The deal would reshape the global food ingredients landscape.

DOL Opens 401(k)s to Alternatives

The Department of Labor proposed a rule making it easier for 401(k) plans to include alternative assets — private equity, private credit, and crypto. The $12 trillion in Americans’ 401(k)s could turbocharge growth in private markets. Critics note the timing is awkward: private credit is floundering as funds limit redemptions amid AI-driven disruption to software company borrowers. “I’d like for someone to convince me this is a good idea,” said Robert Massa of Prime Financial Capital. “I see too many pitfalls.”

Other Headlines

• Sysco-Jetro: $29.1 billion acquisition creating one of the largest U.S. food supply businesses.
• Apollo: Nearing a deal to acquire Atlantic Aviation from KKR at a $10 billion valuation.
• Carlyle: Pitching investors on a defense-focused fund to capitalize on $1.5 trillion Pentagon budget.
• Blackstone: Plans to debut a multi-strategy hedge fund targeting high-net-worth individuals.
• SpaceX IPO: Morgan Stanley’s E*Trade in talks to lead the retail portion of the $75 billion offering. Robinhood and SoFi expected to be excluded.
• Hegseth Insider Trading: The Financial Times reported that Defense Secretary Pete Hegseth’s broker attempted to buy defense ETFs before the Iran strikes. The Pentagon dismissed the report.
• Air Canada: CEO Michael Rousseau will depart before Q3 end after backlash over delivering LaGuardia crash condolences almost entirely in English. The airline is based in French-speaking Quebec.
• Clear Secure: App downloads tripled in March as the DHS shutdown caused airport chaos. Stock up more than 60% since February.
• Fannie Mae: Shares surged 54% yesterday after Bill Ackman called them “stupidly cheap” on X.
• SEC: Semi-annual reporting plan advanced to the White House for review.
• Walmart Recession Indicator: Jim Paulsen’s WMT-based indicator signals a sharp economic downturn.
• Trump Pentagon Budget: Plans to request $1.5 trillion for the 2027 Pentagon budget, a 50% increase.
• U.S. Treasury: Will consult with insurance regulators on private credit oversight.

The Week’s Remaining Calendar

Recession Signals vs. Risk-On Positioning

The macro signals are deeply conflicted. On one hand, the Walmart recession indicator tracked by veteran strategist Jim Paulsen is flashing red, Moody’s has recession odds at 48.6%, Goldman Sachs at 30%, and consumer sentiment recently fell to 53.3 — a three-month low. On the other hand, equity futures are surging on peace hopes, the VIX dropped from above 30 to the mid-27s yesterday, and U.S. equity funds saw their strongest inflows in four months last week.

The bond market is sending a clearer signal. The 10-year yield has fallen to 4.315% from 4.46% in just two sessions, pricing in a Fed that stays on hold or cuts rather than hikes. If bonds are right, the growth scare matters more than the inflation scare. If they are wrong, the recent equity rally on Powell’s dovish signal could unwind quickly when the next CPI or employment print comes in hot.