US stock market today: Wall Street futures gain as easing oil prices offset lingering Middle East tensions

The US stock futures traded higher in Monday's session, 20 July, as crude oil prices retreated sharply from the day's highs amid signs of renewed diplomatic efforts between the US and Iran, easing some concerns over global oil supplies. However, geopolitical tensions in the Middle East remained high.

Futures tied to the S&P 500 advanced 0.5%, while Nasdaq-100 futures gained 1%. Futures linked to the Dow Jones Industrial Average rose 203 points, or 0.4%.

Last week, all three major US indices ended in negative territory, with technology stocks bearing the brunt of the selling pressure after reports emerged that Chinese AI startup Moonshot had developed a new artificial intelligence model capable of competing with leading offerings from OpenAI and Anthropic.

As tensions in West Asia entered their tenth day, Iran's Foreign Ministry said it had received proposals from international mediators aimed at reducing hostilities. The ministry also indicated that negotiations with the United States could continue if they serve the country's national interests, according to media reports.

Meanwhile, the US extended its attacks on Iran, while Iran reportedly fired missiles toward Jordan, raising fears that the conflict could spread further across the region and potentially draw neighbouring Israel into the escalation.

During the latest phase of the conflict, Iran has largely focused its attacks on US-allied Arab states rather than Israel, which launched the military campaign alongside the United States on 28 February.

Step by step, the US and Iran have moved closer to an all-out war after last month's interim agreement, aimed at permanently ending the conflict, collapsed.

The renewed exchange of attacks, now in its second week, has seen the US target bridges and electrical infrastructure inside Iran.

The escalation has unsettled global financial markets, which were already grappling with a sharp selloff in technology stocks, as investors question whether the artificial intelligence-driven investment boom can sustain the sector's lofty valuations.

Chip stocks remained under pressure throughout last week as renewed geopolitical tensions in the Middle East, coupled with stretched valuations, prompted investors to rotate into defensive and value-oriented sectors.

The Philadelphia Semiconductor Index (SOX) plunged 2% on Friday, extending its decline to more than 20% from its late-June peak, officially pushing the index into bear market territory.

Renewed concerns over the sustainability of the artificial intelligence trade and whether hyperscalers will be able to continue investing trillions of dollars in AI infrastructure and capital expenditure have further intensified the selloff in semiconductor stocks.

Following reports of renewed diplomatic efforts between Washington and Tehran, crude oil prices erased all of their intraday gains. Brent crude slipped to around $87 per barrel after briefly climbing above $91, while WTI crude futures retreated from the day's high of $85.39 to around $80 per barrel.

Oil prices had staged a strong rebound following the recent escalation in the Middle East, which reignited concerns over global energy supplies as both the US and Iran sought greater control over the Strait of Hormuz—a strategic waterway that handles nearly 25% of the world's crude oil shipments.

Brent closed the last week with a sharp 16% jump, marking the biggest weekly gain since early March, and it has jumped 22% in July, recovering all of its June losses