S&P 500 Forecast: SPX rises on U.S.-Iran peace hopes and ahead of the SpaceX debut

US futures                                          

Dow futures 0.5%, S&P futures 0.25%  & Nasdaq futures 0.08%

In Europe                                                                        

FTSE 0.95% & DAX 1.16%

• U.S stocks point to a modestly higher open, adding to strong gains yesterday.
• US – Iran deal could be signed this weekend
• SpaceX starts trading on the Nasdaq
• Oil Fools on US-Iran deal optimism

U.S. Futures Rise as SpaceX IPO and Iran Deal Hopes Lift Sentiment

U.S. futures are rising, extending gains from yesterday as investors look ahead to the highly anticipated SpaceX IPO and growing hopes of a peace deal between the U.S. and Iran.

President Trump said yesterday that an agreement between Washington and Tehran to end the conflict and reopen the Strait of Hormuz could be signed as soon as this weekend. Reports suggesting Iran could be willing to agree have helped push oil prices lower, easing inflation concerns and supporting risk appetite.

Attention is also firmly on SpaceX, which is expected to begin trading on the Nasdaq later today. At a valuation of around $1.75 trillion, the company would immediately become one of the largest publicly listed firms in the U.S.

The IPO is being closely watched not only because of its size, but also because it could provide an important test of investor appetite for high-growth technology companies. Strong demand could reinforce confidence in the AI and technology sectors, while a weaker debut could raise questions over stretched valuations following this year's rally.

SpaceX is expected to trade under the ticker SPCX at $135 per share. Index providers, including Nasdaq and FTSE Russell, have adjusted inclusion requirements ahead of the listing, which could contribute to elevated market volatility in the coming sessions.

The company reported a $4 billion loss last year as it continued to invest heavily in its AI and technology businesses. While profitability remains some way off, investors are betting that future growth in satellite communications, AI infrastructure and space services will justify the premium valuation.

The S&P 500 is on track to end the week broadly unchanged after last week's decline snapped a nine-week winning streak.

Corporate movers

Adobe is falling 6% after reporting fiscal Q2 operating margins below expectations and announcing that CFO Dan Dunn will step down on June 15. The company did, however, beat earnings and revenue forecasts.

Lennar is under pressure after reporting quarterly revenue of $7.94 billion, below expectations of $8.02 billion. Home deliveries also missed forecasts, pointing to ongoing weakness in the housing market.

Space-related stocks are rising ahead of the IPO. Rocket Lab is up 6%, while Redwire is gaining 4% as investors position for increased interest in the sector.

Energy stocks are moving lower alongside oil prices, while travel-related names are benefiting from lower fuel costs. United Airlines is up around 1%, while cruise operators are also trading higher.

S&P 500 forecast – technical analysis

The S&P 500 has pulled back from its record high of 7,620, breaking below the 20-day SMA before finding support at 7,240 near the 50-day SMA.

The recovery from support is looking towards the 20-day SMA at 7,470. A move above this level would improve near-term momentum and bring the record high at 7,620 back into focus.

On the downside, sellers would need to break below 7,230 and the 50-day SMA to expose the psychological 7,000 level. A move below this area would weaken the broader bullish structure.

FX markets – USD steady, focus on policy outlook

The U.S. dollar is holding steady as easing safe-haven demand linked to improving Middle East sentiment is offset by expectations that the Federal Reserve may keep interest rates higher for longer following this week's inflation data.

EUR/USD is broadly unchanged after yesterday's ECB-driven rally. The ECB raised interest rates by 25 basis points to 2.25%, as expected, and maintained a hawkish tone as eurozone inflation remains elevated at 3.2%.

GBP/USD is little changed after data showed UK GDP contracted by 0.1% month-on-month in April. Combined with weakening labour market conditions, the data reduce the likelihood of aggressive Bank of England tightening, which could limit upside potential for sterling.

Oil falls as hopes for Iran agreement grow

Oil prices have fallen to their lowest levels in two months after President Trump cancelled planned strikes on Iran and suggested a deal could be signed within days.

Optimism surrounding a potential agreement has improved expectations that energy flows through the Strait of Hormuz could gradually normalise, easing concerns over supply disruptions.

WTI has fallen below $85 per barrel, while Brent has slipped under $90.

However, further downside may be limited until traders see clear evidence that shipping traffic through the Strait of Hormuz is returning to normal. Until then, geopolitical risk will continue to provide some support for oil prices.