US equity futures surged on Monday, with S&P 500 and Nasdaq contracts jumping as much as 1.7%, driven by a sharp pullback in crude oil prices.
The rally in risk assets followed emerging signs of diplomatic progress between the United States and Iran, which helped ease the geopolitical premium that had weighed on markets for weeks.
Brent crude retreated significantly from its intraday peaks as investor anxiety over potential supply disruptions in the Strait of Hormuz subsided.
The decline in energy costs provided immediate relief to inflation-sensitive sectors and helped reverse the broad technology-led selloff that had defined the previous trading week.
Lower oil prices also improved the outlook for consumer spending and corporate margins, fueling the broad-based advance in US equities.
The market reaction underscores the sensitivity of global risk assets to geopolitical developments in the Middle East.