U.S. equity futures climbed on Tuesday as momentum in semiconductor stocks carried into a second trading session and reports that fighting between Iran and Israel had paused helped lower market anxiety. Nasdaq 100 futures led early gains, driven by strength in chipmakers ahead of the cash open.
In premarket activity, shares of Nvidia, Broadcom and Micron Technology were higher, rising in a band between 0.8% and 4.4%, extending their rebound from a sharp selloff that hit markets on Friday.
There was also relief on the geopolitical front. Iran and Israel both said on Monday that they had stopped attacking each other following an appeal from U.S. President Donald Trump, reverting to a fragile ceasefire that was first announced on April 8. That development helped sentiment, although traders remained cautious because diplomatic efforts have not yet produced a durable peace and the Strait of Hormuz remains shut.
Energy markets reacted to the reduced intensity of hostilities. Oil prices fell more than 2%, wiping out most of the previous session's gains, but officials and market participants continued to flag that uncertainty persists while diplomatic outcomes remain unresolved.
By 05:57 a.m. ET, Dow E-minis were up 120 points, or 0.24%. S&P 500 E-minis were higher by 34.75 points, or 0.47%, and Nasdaq 100 E-minis were up 238 points, or 0.81%.
Technology and artificial intelligence stocks had experienced heavy selling late last week after Broadcom issued a disappointing forecast that stoked concerns over rich valuations across the sector - particularly among chipmakers that have posted strong rallies this year. Those valuation worries were compounded by a stronger-than-expected jobs report on Friday, which raised investor concern that the Federal Reserve could still move to raise interest rates later this year.
Investors will be watching consumer prices data for May, due on Wednesday, for additional signals about how the recent jump in energy costs related to the Iran conflict may be filtering through to inflation readings.
Market attention has also been drawn to large potential supply events in the technology IPO pipeline. SpaceX's $1.75 trillion market debut on Friday is cited as a potential headwind for U.S. equities, as some investors worry that exuberance around high-growth technology names could be excessive. Elon Musk's SpaceX is targeting a $75 billion raise, the largest ever sought in an initial public offering.
In corporate moves, the maker of ChatGPT, OpenAI, said on Monday that it had confidentially filed for a U.S. initial public offering, joining Anthropic in taking steps toward public markets.
Data center and infrastructure-related stocks also saw notable moves. Applied Digital climbed 11.5% after announcing a 15-year lease with a U.S.-based hyperscaler at its Delta Forge 2 site; the agreement is expected to generate about $5.2 billion in revenue over the life of the lease.
Biopharma activity influenced trading as well. Shares of cancer drug developer Nuvalent surged 39% after GSK agreed to acquire the company for $10.6 billion, valuing Nuvalent at roughly $124 per share - about a 40% premium to its last closing price.
Bottom line: Early Tuesday futures activity reflected a rebound in chip stocks, easing geopolitical tensions and a pullback in oil prices, while investors parsed potential economic implications from labor data, upcoming inflation figures and high-profile corporate deals and IPO activity.