SG Morning Brief | Futures Surge Above 7,500 on Iran Deal Hopes, STI Hits 52-Week High

US Overnight

US cash markets were closed Monday for Memorial Day, but futures surged overnight. S&P 500 futures climbed above 7,534 — a new all-time high — gaining 0.9%. Nasdaq 100 futures rose 1.2% and Dow futures jumped 441 points (+0.9%). The catalyst was Trump saying talks with Iran were "proceeding nicely," though he warned the US could go on the offensive if negotiations break down. WTI crude futures plunged roughly 6% on the comments, and a Qatari diplomatic team flew into Tehran over the weekend to help secure a deal. The dollar weakened against all G-10 currencies. Bloomberg reported that global stocks rose to record highs. However, key sticking points remain: Iran's enriched uranium stockpile and the Strait of Hormuz toll dispute. Secretary of State Rubio has said a deal is "unfeasible" if Iran insists on permanent control of Hormuz shipping. Barclays warned that even if Hormuz reopens today, inventories would begin from a level roughly 20 million barrels below the tight thresholds that historically support prices.

SGX Update

The STI closed at 5,070.55 (+0.05%) on Monday, setting a new 52-week intraday high after opening at 5,092.68 before giving back gains into the close. The previous 52-week high of 5,073.11 was set on May 21. DBS is trading near S$62.18 and UOB near S$37.91 — both well above levels from earlier this month. The overnight US futures surge and WTI -6% should provide a strong tailwind for today's session. If the Iran deal materializes, Singapore's import-dependent economy benefits directly through lower energy costs and easing inflation, supporting both consumer stocks and the banking sector.

Asia Pre-Market

S&P 500 futures are up 0.9%, Nasdaq 100 futures up 1.2%, and Dow futures up 0.9% — a strong handoff to Asian markets. WTI crude is down roughly 6% overnight. Gold, Bitcoin, and bond yields data were not yet updated following the holiday weekend. The risk-on tone is clear, but markets have been burned before by Iran deal optimism that failed to materialize. The key test is whether oil stays below $95 through today's session.

This Week's US Earnings and Economic Calendar

US markets reopen today, Tuesday May 26.

Data Spotlight: April Core PCE (Friday May 29) — The Fed's preferred inflation gauge arrives at the end of a shortened week. March core PCE was +2.6% YoY. The April print will reflect the full impact of $100+ oil on consumer prices. If core PCE rises toward 3%, the rate hike narrative hardens under new Chair Warsh. If it holds near 2.6%, the market gets breathing room. Consumer Confidence today will also be closely watched — the University of Michigan survey last week showed long-run inflation expectations at 3.9%, the highest in over a year.

One More Thing

Gas at $4.55 per gallon on Memorial Day weekend — the highest since 2022, up over 50% since the Iran war began on February 28. That is the number that matters to the 80% of Americans who don't own stocks. The market is surging on the prospect of peace, but the consumer is already living in the aftermath of three months of $100 oil. Even if a deal closes tomorrow and Brent drops to $80, gasoline prices take 4-6 weeks to fully adjust at the pump. The CNBC-Almanac seasonal outlook warns that June is historically the worst month for equities in midterm election years — the S&P 500 has lost 2.1% on average. Eight consecutive winning weeks have created a market that is priced for peace and falling oil. If that's what we get, the rally extends. If the talks collapse again, there is a lot of air beneath us.

This briefing is for informational purposes only and does not constitute investment advice.