Wall Street futures hold steady as oil stays above $100 before bank earnings

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Wall Street futures, oil, bank earnings

Highlights

Brent crude remains above $100 per barrel amid ongoing Middle East conflict and ambiguous U.S.-Russia diesel deal, creating continued oil market volatility.
Earnings season starts Tuesday with Wells Fargo, Goldman Sachs, Citigroup, and JPMorgan Chase reporting as S&P 500 Q3 earnings are forecast to rise 30.6%, per LSEG IBES.
Dow E-minis rise 0.08% and S&P 500 E-minis gain 0.12% premarket, while higher energy prices threaten inflation outlook and keep investors wary of potential Fed rate hikes.

Oil prices and earnings set the tone

As reported by Reuters, Wall Street futures are little changed as traders track oil market volatility and prepare for the start of the third-quarter earnings season.

Oil swings between gains and losses after President Donald Trump says Ukraine and Russia have agreed to halt attacks on each other's energy facilities following a U.S. diesel-supply deal with Moscow. Details of the arrangement are not clear, however, and the plan is facing opposition in Washington.

The Middle East conflict is also keeping Brent crude above $100 a barrel after deadly strikes on Riyadh's international airport over the weekend. Chris Beauchamp, chief market analyst at IG, says hopes that Trump's deal with Vladimir Putin could help lower prices have been offset by the escalation in the Houthi conflict.

Earnings season begins on Tuesday, with Wells Fargo, Goldman Sachs, Citigroup and JPMorgan Chase among the first major U.S. banks due to report. S&P 500 earnings are expected to rise 30.6% in the third quarter, according to LSEG IBES data.

Inflation outlook and market positioning

At 05:36 a.m. ET, Dow E-minis are up 42 points, or 0.08%, S&P 500 E-minis gain 9.75 points, or 0.12%, and Nasdaq 100 E-minis slip 14.75 points, or 0.05%. The three main indexes ended higher last week as optimism about AI-driven earnings and expectations that the Fed may avoid near-term rate hikes outweighed sharp moves in oil and Treasury markets.

Treasury yields have climbed to levels seen earlier this month as higher energy prices fuel concern that inflation could remain sticky, a backdrop that could keep policymakers hawkish and pressure equity valuations. The U.S. Treasury market is closed for Columbus Day.

Investors are also watching this week's consumer price index, producer price index and retail sales data. Higher energy prices are expected to lift headline CPI by 0.6% on the month and 3.7% on the year, while core inflation is seen rising 0.2% monthly and 2.5% annually.

Markets are pricing in a 19% chance that the central bank raises interest rates this month, according to CME's FedWatch tool. In premarket trading, IREN shares jump 5.4% after The Information reports that Anthropic has entered a multi-year cloud deal with the data-center company.

In our earlier coverage of gold’s move higher, we explained how softer oil prices and a weaker U.S. dollar improved the backdrop for bullion at the start of the week. We also noted that traders were closely watching the upcoming CPI, PPI, and retail sales releases for clues on the Federal Reserve’s next policy move and the path of interest rates.

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