U.S. stock index futures gave back small ground on Monday evening as investors remained on edge ahead of a hard deadline set by President Donald Trump tied to the reopening of the Strait of Hormuz.
By 20:15 ET (00:15 GMT), S&P 500 futures were down 0.2% at 6,640.50 points, while Nasdaq 100 futures slipped 0.3% to 24,290.75 points. Dow Jones futures were largely unchanged at 46,937.0 points.
Earlier in the trading day, major U.S. benchmarks finished in positive territory: the Dow Jones Industrial Average rose 0.4%, the S&P 500 gained 0.5% and the NASDAQ Composite advanced 0.5%.
Geopolitical developments drive market caution
Investor attention centered on fast-moving events in the Middle East after Tehran rejected a ceasefire proposal. That plan, backed by the United States and developed with regional mediators including Pakistan, Egypt and Turkey, proposed a 45-day ceasefire and the reopening of the Strait of Hormuz, a vital route for global oil shipments.
Iran declined the proposal and instead demanded a permanent end to hostilities that would include binding guarantees against future attacks, the lifting of sanctions, compensation for war-related damages and a broader regional settlement. In response, President Trump increased rhetoric ahead of a deadline that the White House said would expire at 8 p.m. ET on Tuesday. He warned that noncompliance could prompt extensive U.S. strikes against Iranian infrastructure, citing potential targets that include power plants and bridges.
The Strait of Hormuz typically handles roughly one-fifth of global oil flows. Its continued disruption amid the conflict has been a factor pushing crude prices sharply higher and adding to concerns about inflationary pressure.
Economic data adds to uncertainty
Market participants also digested U.S. services-sector data for March. The Institute for Supply Management reported that its non-manufacturing PMI fell to 54.0 from 56.1 in February, below the 54.8 level that had been expected, though it remained above the 50 threshold that separates expansion from contraction.
The ISM snapshot indicated a mixed backdrop: business activity showed signs of slowing and measures of employment weakened, while demand-related indicators such as new orders remained comparatively firm. A striking detail from the report was a sharp surge in the prices-paid index, marking the largest increase in more than 13 years and highlighting mounting inflation pressures tied to higher energy costs and supply disruptions.
Outlook and investor focus
With geopolitical risk concentrated around the Strait of Hormuz and fresh inflation signals emerging from the ISM report, investors entered the deadline with heightened caution. Equity futures reflected that stance, with modest declines on the eve of a decision that could have immediate implications for energy flows and market sentiment.
Given the limited information available beyond official statements and the ISM release, market participants appeared to be positioning for a range of outcomes while closely monitoring any further diplomatic moves or changes in rhetoric that could affect oil transport and prices.