Dow futures rise 120 points: 5 things to know before market opens

• Iran is reviewing a US peace proposal that would gradually reopen the Strait of Hormuz and lift naval blockades, easing oil supply concerns and sending crude prices lower
• Earnings season remains exceptionally strong with 84% of S&P 500 companies (71% reported) beating analyst expectations, led by tech and AI-related stocks including Alphabet, Amazon, and Meta
• Friday's non-farm payrolls data represents the week's most critical release, as it will shape Fed rate policy outlook amid concerns about balancing growth slowdown risks against persistent inflation

Market Summary: Dow Futures Rise on Diplomatic Progress and Strong Earnings

Market Overview:

U.S. equity futures opened higher Thursday, with Dow futures up 120 points (+0.24%), while S&P 500 and Nasdaq 100 futures also gained. Markets are responding positively to diplomatic developments, falling oil prices, and robust earnings reports.

Key Developments:

*Iran-US Diplomatic Progress:* Tehran is reviewing a U.S. peace proposal centered on a one-page memorandum that would gradually reopen the Strait of Hormuz and lift naval blockades on Iranian ports. While not yet accepted, the development represents a significant shift in negotiations.

*Oil Price Decline:* The prospect of Hormuz reopening has driven crude prices sharply lower, easing inflation pressures that have plagued markets since the Middle East conflict began in late February. This could provide the Federal Reserve greater flexibility on rate policy, though Chicago Fed President Goolsbee cautioned inflation remains "a long way from" the 2% target.

*Earnings Season Strength:* With 71% of S&P 500 companies reported, 84% have beaten analyst expectations—well above historical averages. Technology and AI-related stocks, including Alphabet, Amazon, and Meta, have led gains.

*Company Highlights:* Disney stock surged in early trading after reporting revenue of $25 billion and EPS of $1.57, driven by recovering theme parks and streaming. McDonald's, Gilead Sciences, and Airbnb are scheduled to report Thursday.

*Critical Data Ahead:* Friday's non-farm payrolls report represents the week's most important release, with potential to reshape Fed policy expectations. Markets face a delicate balance—too much labor market cooling could signal growth concerns, while excessive strength may cement a prolonged rate pause.

Sentiment: Bullish (72/100 AI score)