US futures whipsawed and crude oil spiked higher as tensions flared up again in the Middle East, taking the focus off a run of strong earnings by megacap tech companies. As of 8:00am ET, S&P and Nasdaq 100 futures dropped 0.2% from Friday's record highs, falling as much as 0.5% just minutes earlier afterIran’s Fars agency claimed two missiles hit an American patrol boat, before erasing most of the declines after the US denied a ship was hit.All of this after Trump said Sunday that US Navy will guide ships out of the Strait of Hormuz from Hormuz in a move called “Project Freedom" while Iran issued Trump a one-month deadline for negotiations on its proposed 14-point deal to reopen the Strait of Hormuz. European stocks were mostly red while tech-heavy Asia indexes in South Korea and Taiwan surged in Monday trading. In premarket trading, Mag 7 names are mixed: GOOGL (+0.6%), AMZN (+0.6%), and META (+0.7%) are outperforming, while AAPL and MSFT are lower. Brent crude surged more than 5% to trade above $113 a barrel before paring the gain, while bitcoin and gold traded in a mirror image. Interest rates are higher with the 10Y yield rising 4bps to 4.41%; WTI crude added ~$2 to $104 this morning having briefly traded above $107; base metals are higher, while gold and silver both sliding more than 2%. Looking at the US economic data calendar slate includes March factory orders at 10am. Fed speaker slate includes New York Fed President John Williams at 12:50pm

In premarket trading, Mag 7 stocks are mixed (Alphabet +0.2%, Amazon -0.08%, Apple -0.4%, Nvidia -0.06%, Meta -0.09%, Microsoft -0.4%, Tesla +0.2%)

In deals, GameStop proposed to buy eBay for about $56 billion in cash and stock, a bold attempt by Ryan Cohen to take over a storied e-commerce name several times larger. Some have wondered if Blockbuster or Circuit City would announce a hostile takeover of GameStop while it is buying eBay.

Iran moved to assert control over the Strait of Hormuz, a choke point for oil shipping, after President Donald Trump said the US would begin guiding ships not involved in the conflict through the waterway from Monday. The heightened tensions stalled a global stocks rally driven by optimism around the artificial intelligence trade and buoyant tech earnings. Sentiment was dented after Iran’s Fars agency claimed two missiles hit an American patrol boat, before erasing most of the declines after the US denied a ship was hit; the rapid recovery suggested the rally may not be over. Meanwhile, NATO Secretary General Mark Rutte warned European leaders that Trump is disappointed with their reluctance to assist with the war.

“This is just another dip that investors will want to buy into,”said David Kruk, head of trading at La Financiere de l’Echiquier in Paris. “Yes, the news from Iran led to a spike in oil prices but we’re now used to those. Investors are very much focused on the surprisingly good earnings season we’ve had so far, on the AI trade.”

Elsewhere, the AI narrative has continued to capture attention and tech-heavy Asia indexes in South Korea and Taiwan surged in Monday trading. However, some investors are using the rally to book profits, withhedge fund sharply unwinding risk in technology stocksfor a second straight week, according to Goldman's Prime Brokerage.

As Bloomberg notes, first-quarter earnings strength hasn’t been limited to megacap tech. It’s showing up across sectors. Small caps are on a tear, bank profits are booming and firms keep plowing past macroeconomic obstacles. The breadth of earnings revisions has even accelerated since the start of earnings season. The EPS surprise for the median S&P 500 stock in Q1 is 6%, the strongest in four years, according to Morgan Stanley's Michael Wilson.

Global stocks have been rising for more than a month astraders have set aside concerns about the economic fallout from the Middle East hostilities,with signs of corporate resilience driving US stocks to their best month since 2020. The proportion of companies missing analysts’ estimates is hovering at the lowest level since 2021 as earnings wind down for two-thirds of the stocks in the S&P 500 Index, which has posted five consecutive week of gains.

“We’ve gone from a market mainly driven by geopolitics to a market focused on earnings and these have been really positive across the board,” said Vincent Juvyns, chief investment strategist at ING in Brussels “Tech has been a driving force, but financial and energy stocks have also lifted indexes and earnings expectations.”

European shares slipped as carmakers fell following US President Donald Trump’s latest tariff threat. The Stoxx Europe 600 index declined about 0.5%, with the automobiles and parts sector down more than 1%. Mercedes-Benz Group AG dropped 2% and Bayerische Motoren Werke AG slid 1.9%. Trump said he would raise tariffs on European auto imports to 25%, adding to woes for the sector after a tepid earnings season. Here are the biggest movers Monday:

Source: ZeroHedge News