Stock futures fell ahead of Monday’s session after the United States entered Israel’s war against Iran over the weekend by striking three nuclear sites, a move by President Donald Trump that raised oil prices and risked a bigger conflict in the Middle East.
Futures tied to the Dow Jones Industrial Average fell by 109 points, or 0.3%. S&P 500 futures shed 0.3% and Nasdaq 100 futures lost 0.4%.
The U.S. launched attacks Saturday at Iranian sites in Fordo, Isfahan and Natanz, surprising investors who were expecting more diplomacy to possibly take place after Trump said on Friday that he would make a decision to attack Iran “within the next two weeks,” according to the White House.
Oil prices have already spiked in recent weeks following the increased tensions in the Middle East. On Sunday night, U.S. crude oil futures rose another 3.8% to nearly $77 a barrel.
“When you have conflict, you have an overreaction — a knee jerk reaction — which tends to be an exaggeration, that can last up to two to three weeks,” said Jay Woods, chief global strategist at Freedom Capital Markets. “With Ukraine, the S&P 500 sold off 6% and oil spiked dramatically.”
Trump said in a Saturday evening speech from the White House after the attacks, that “there will be either peace, or there will be tragedy for Iran far greater than we have witnessed over the last eight days.”
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