US futures pare gains to fall flat on the day now

[Forex News]

S&P 500 futures were up by around 0.7% earlier in the day on hopes of "peace" as US president Trump extended the cooling period on strikes against Iranian energy facilities for another 10 days. That as he touts "very substantial talks" happening in the background.

All that being said, this is all mere noise. As mentioned, nothing changes for markets until something changes on the Strait of Hormuz. And we're starting to see market players realise that more and more with each passing day. From earlier: The can being kicked down the road is not a good thing for markets

Now, S&P 500 futures are flat on the day and we're starting to see the steady open in Europe unravel. The DAX itself is down 0.7% with the CAC 40 down 0.5% on the day currently. It's all looking rather dicey for stocks once more as we get some de-risking ahead of the weekend.

The issue with pushing the deadline further out is that:

"It just means with every passing day that oil supply gets tighter and the risk for energy disruption across the Gulf region will continue. Yes, kicking the can down the road might prevent "bad" news from what we can see in terms of military strikes, explosions, and casualties. However, that just continues to mean that markets are caught in limbo for an extended period of time with the oil market tightening further and countries needing to dig deeper into their reserves more and more. From an economic standpoint, it's an awful scenario to just keep prolonging the status quo."

Again, it all comes down to what happens with the Strait of Hormuz. If Iran is not going to loosen their restrictions on how many ships can pass through, talks of peace don't matter.

As stocks ease back, we're seeing oil prices climb back up again with WTI crude now up nearly 2% to $95.96. That continues to see oil prices eat into the Monday drop.

This article was written by Justin Low at investinglive.com.

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