By Twesha Dikshit and Utkarsh Hathi
May 26 (Reuters) – Wall Street’s main indexes were poised to open higher on Tuesday, catching up after a public holiday, as optimism in AI-related stocks offset some concerns over Middle East peace talks following recent U.S. strikes on Iran.
Iran’s Tasnim news agency reported that Tehran is seeking the release of $24 billion of Iranian funds frozen overseas in the deal that’s being negotiated with the U.S.
U.S. Secretary of State Marco Rubio said on Tuesday the deal could “take a few days,” while President Donald Trump said in a Truth Social post on Monday that talks with Iran were going “nicely.”
“It’s cautious optimism in markets today with a singular focus on planning an off-ramp for this war, but with an understanding that it will take a while for energy prices and inflation (to) come back to earth,” said Art Hogan, chief market strategist at B Riley Wealth.
Brent crude oil rose as much as 2% but remained below $100 a barrel, and global stocks wavered as uncertainty lingered over whether a deal would be reached to open up shipping flows through the Strait of Hormuz.
Semiconductor stocks, which have surged on AI-driven demand, led gains in premarket trading. Marvell Technology rose 6.8%, Micron climbed 7%, while Intel, and Qualcomm added 1.6% and 2.5%, respectively.
At 08:06 a.m. ET, Dow E-minis were up 271 points, or 0.53%, S&P 500 E-minis were up 50.25 points, or 0.67%, and Nasdaq 100 E-minis were up 321.75 points, or 1.09%.
Wall Street has been trading at record highs, with upbeat earnings and confidence in AI trade driving equities higher despite the ongoing conflict with Iran.
The blue-chip Dow became the last index to hit a record high on Friday, its first since the Iran war began, while the S&P 500 posted its best winning streak since December 2023.
With the earnings season nearly over, first-quarter earnings growth is expected to be 29% year-on-year compared with the 16.1% estimated a month ago, according to LSEG data from Friday.
Kevin Warsh was sworn in as chair of the Federal Reserve on Friday. His appointment comes amid growing concerns about inflation, driven by higher oil prices, which have added to expectations of tighter global monetary policy.
Markets currently expect the Fed to keep rates on hold for the rest of the year, with a 25 bps rate hike seen in December.
U.S. consumer confidence data for May is expected later in the day, with higher gasoline prices due to the Middle East conflict expected to weigh on consumer sentiment.
Before the bell, Eli Lilly advanced 1.2% after the drugmaker said it would buy three vaccine developers in deals worth up to nearly $4 billion in combined value.
Pony AI’s shares climbed 17.5% after the company said it plans to expand its robotaxi fleet.
(Reporting by Twesha Dikshit and Utkarsh Hathi in Bengaluru; Editing by Shinjini Ganguli)
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