U.S. stock futures experienced a significant decline on Monday, following a turbulent end to the previous week marked by losses across major indices. The fallout from escalating tensions related to the ongoing Iran-U.S. conflict has added pressure to the markets.
The situation intensified over the weekend with reports confirming the death of 86-year-old Iranian Supreme Leader Ayatollah Ali Khamenei, resulting from military strikes conducted by Israel and the U.S. In a statement, President Donald Trump indicated that the military operations, referred to as “Operation Epic Furry,” could last “four to five weeks” if deemed necessary. This announcement contributed to heightened uncertainty in global markets.
According to Polymarket data, the likelihood of a positive opening for the index on March 2 plummeted to only 10%, reflecting a sharp 40% decline from previous assessments. Trading volumes surged past $1.07 million, revealing significant investor sentiment shifts. Meanwhile, Treasury bond yields presented a mixed picture, with the 10-year bond yielding 3.97% and the two-year bond at 3.42%. The CME Group’s FedWatch tool indicated a substantial 95.4% chance that the Federal Reserve would opt to maintain current interest rates during its next meeting in March.
In terms of index performance, the Dow Jones dipped by 1.15%, the S&P 500 fell 1.12%, the Nasdaq 100 decreased by 1.51%, and the Russell 2000 saw a decline of 1.36%.
A closer look at individual stocks reveals a mixed bag of performances this morning. AMTD Digital Inc. (NYSE: HKD) experienced a notable surge of 20% in premarket trading following a year-over-year increase in fiscal year 2025 revenue results. Conversely, Aardvark Therapeutics Inc. (NASDAQ: AARD) witnessed a staggering drop of 53.56% after voluntarily pausing its Phase 3 Hunger Elimination or Reduction Objective trial. Avalon Globocare Corp. (NASDAQ: ALBT) fell by 22.82% after announcing the closure of a private placement worth up to $9.75 million, while LI Bang International Corp. (NASDAQ: LBGJ) decreased by 24.85% due to its subsidiary’s acquisition announcement.
MongoDB Inc. (NASDAQ: MDB) also faced downward pressure, with a 2.27% decline as analysts predicted earnings of $1.45 per share on revenue of $667.15 million prior to its earnings report after the market closes.
Consumer staples, health care, and energy sectors saw gains during the previous session, while information technology and financial stocks finished lower. Analyst Mohamed El-Erian has characterized the current economic landscape as one facing “new stagflationary wind,” influenced by geopolitical tensions and persistent domestic inflation data. He cautioned that the “last mile” of the inflation battle remains challenging, with January’s core Producer Price Index (PPI) jumping 0.8%, exceeding expectations.
El-Erian also identified volatility, dispersion, and fragmentation as three defining themes for the U.S. stock market, emphasizing the fragility caused by rising insurance premiums and disruptions in global trade logistics. He noted the potential for distinct disparities to emerge between market “winners and losers” as energy costs rise and overall growth encounters obstacles, complicating the strategies for central banks.
Looking ahead, investors are closely monitoring upcoming economic data amid shifting market dynamics. In commodity trading, crude oil futures increased by 7.71%, reaching approximately $72.19 per barrel. Meanwhile, gold prices rose by 2.22%, hovering around $5,395.00 per ounce. The U.S. Dollar Index saw a rise of 0.66%, landing at the 98.2480 level.
In the cryptocurrency market, Bitcoin was trading 0.10% lower at $66,306.44.
Asian markets presented a mixed picture on Monday; while China’s CSI 300 and Australia’s ASX 200 indices showed gains, Japan’s Nikkei 225, Hong Kong’s Hang Seng, South Korea’s Kospi, and India’s Nifty 50 indices registered declines. European markets opened mostly lower, reflecting the ongoing global economic uncertainty.
