March 25 (Reuters) - U.S. stock index futures climbed on Wednesday, after media reports that the U.S. was seeking a month-long ceasefire in its war with Iran, allaying some investor fears around prolonged energy supply disruptions.
The New York Times reported that Washington sent Iran a 15-point plan to end the war. Israel's Channel 12 said the U.S. planned to discuss the plan during the proposed ceasefire.
Tehran has denied any negotiations and Iran and Israel exchanged airstrikes on Wednesday.
"While
we don't envision U.S. escalation going forward, we would also be surprised to see a near-term resolution... There could be a scenario where the combination of a resilient Iran and rising energy prices forces President Trump to escalate, but that does not appear imminent," said Mike O'Rourke, chief market strategist at JonesTrading.
Global markets drew comfort from the reports, hoping for a breakthrough that could help restore shipping through the crucial Strait of Hormuz. Oil prices ticked about 4% lower, supporting broader risk appetite.
"Investors should be cautious about assuming a swift resumption of energy flows, but our base case is that they will be restored without meaningful or lasting economic damage," said analysts at UBS Global Wealth Management.
Wall Street's main indexes closed lower on Tuesday after trading in limbo, as a relief rally sparked by President Donald Trump's decision to postpone strikes on Iran's power network fizzled out.
At 05:13 a.m. ET, Dow E-minis were up 437 points, or 0.94%, S&P 500 E-minis were up 60 points, or 0.91%, and Nasdaq 100 E-minis were up 261.75 points, or 1.08%.
The spike in oil prices tied to the Iran conflict has revived inflation concerns, complicating the interest rate outlook of central banks.
Markets are not pricing in any easing from the Federal Reserve this year, compared with two cuts anticipated before the war broke out, according to CME Group's FedWatch Tool.
Meanwhile, U.S.-listed shares of Arm jumped 12.6% in premarket trading after the company unveiled a new AI data center chip that is expected to bring billions of dollars in revenue.
Other chipmakers also inched higher with Intel up 3.8%, Marvell Technology gaining 2.9% and Nvidia 1.3% higher.
U.S.-listed shares of JD.com and Alibaba gained more than 4% each after Chinese state media and the regulator urged the food delivery platform industry to end a bleeding price war.
Destiny Tech100 surged 20% after a report that SpaceX aims to file its IPO prospectus as soon as this week. SpaceX is the fund's largest equity holding.
Robinhood Markets added 3.6% after the trading platform announced a new $1.5 billion share buyback program.
(Reporting by Purvi Agarwal and Medha Singh in Bengaluru; Editing by Mrigank Dhaniwala)
