Wall Street Forecast: Dow gains on Iran peace hopes, Netflix falls

US futures                                         

Dow futures 0.45%, S&P futures 0.29%  & Nasdaq futures 0.23%

In Europe                                                                        

FTSE -0.29% & DAX 0.58%

• US stocks rise with SPX & NDX at record highs
• Hopes of peace ahead of weekend talks
• Netflix falls 9% despite Q1 beat
• Oil falls across the week on peace optimism

Stocks rise as truce hopes build

US stocks are set for a higher open, with the S&P 500 and Nasdaq trading near record highs, while the Dow Jones lags but remains on track for solid weekly gains.

Wall Street has fully erased losses seen earlier in the conflict, with equities returning to pre-war levels after a sharp 10% round trip in just six weeks—highlighting strong market resilience amid geopolitical uncertainty.

Sentiment has improved on rising hopes of a resolution to the Iran conflict. President Trump stated that a deal could be close, with further US–Iran talks expected this weekend. Meanwhile, Israel and Lebanon have agreed to a ceasefire, supporting expectations of broader de-escalation and longer-term peace.

However, risks remain elevated. The Strait of Hormuz is still closed due to a US blockade of Iranian vessels, although Iran is reportedly considering proposals to allow limited passage on the Omani side. Any renewed escalation could quickly reverse gains.

Falling oil prices this week have eased inflation concerns and pulled Treasury yields lower, providing additional support for equities.

Corporate Movers

Netflix shares are falling 10% premarket despite beating Q1 revenue expectations and posting a sharp jump in earnings. Revenue came in 16% higher year-on-year at $12.25 billion. Earnings also surged, with net income of $5.28 billion, or $1.23 per share—almost double what it earned in the same period last year. However, a large portion of that profit came from a one-off $2.8 billion termination fee tied to its scrapped deal with Warner Bros. Discovery.

The outlook for Q2 also disappointed, with the company expecting EPS of $0.78 per share on revenue of $12.57 billion, both below expectations. This weaker outlook, combined with news that chairman of almost three decades Reed Hastings is stepping down, marks the end of an era.

Apple will be in focus after shipments in China jumped 20% in Q1, the strongest growth among major vendors, even as the broader market contracted amid rising memory chip costs. The increase was driven by sustained demand for the iPhone 17.

Dow Jones forecast -Technical Analysis

The Dow Jones recovered from the 44,810 low, pushing above the 50 and 200 SMAs to a high of 48,767. The bias remains supported by momentum, with buyers looking to extend gains towards 50,000, the round number, and then on to 50,500 for fresh record highs. Support can be seen at 48,400, the January low, and below here the 50 SMA at 48,000. A break below this level exposes the 200 SMA at 47,000.

FX Markets – USD falls, EUR/USD gains

The US dollar is falling as Treasury yields track lower on optimism towards a potential resolution in the Middle East. A clear path towards reopening the Strait of Hormuz could lead to lower oil prices, limiting inflationary pressures and pulling yields and the dollar lower still.

EUR/USD is modestly higher and is set to gain across the week amid US dollar weakness, as eurozone inflation jumped to 2.6%, supporting the view that the ECB could hike rates again soon.

GBP/USD is unchanged despite a weaker dollar, as pressure mounts on Prime Minister Starmer, who is facing renewed calls from the opposition to resign. This comes after it was revealed that Peter Mandelson, the former ambassador to the US, failed security checks but was still allowed to take the job. Any replacement for Starmer would likely be more left-leaning and inclined to increase spending, despite the government's precarious fiscal position.

Oil falls ahead of Potential weekend peace diplomatic talks

Oil prices are falling on Friday and are set to decline around 3% across the week, as investors look ahead to possible talks between the US and Iran this weekend and a ceasefire between Lebanon and Israel, raising optimism that the war in the Middle East could end soon.

Oil prices have reacted to headlines of escalation and de-escalation, with the latest comments from Trump indicating that an Iran deal is very close.

However, the Strait of Hormuz remains closed, and this continues to be a key focus for markets. At the same time, talks in Britain today will involve around 40 nations aimed at signalling to the US that they are ready to play a role in restoring flows across this key economic route.