US Stock Futures Rise as Mood Brightens, Oil Falls

US equity-index futures rose after a volatile week as optimism grew over potential Federal Reserve interest-rate cuts and reports that US officials may allow Nvidia Corp. to sell AI chips to China.

Futures on the S&P 500 and Nasdaq 100 gained about 0.5% as the new week began, after the underlying gauges gained Friday to close out a turbulent stretch marked by a selloff in riskier corners of the market. Bitcoin edged lower Monday, giving up some of the gains from a rally during the weekend. Shares in Australia and South Korea also opened higher, while Japan is closed for a holiday.

Oil extended its slump after the biggest weekly loss since early October, as traders weighed the prospect of a Ukraine-Russia peace deal that could increase crude flows into an already well-supplied market.

Risk sentiment improved on Wall Street amid reports US officials were having early talks on whether to let Nvidia sell its H200 artificial intelligence chips to China. The market also got an injection of hope after Fed Bank of New York President John Williams suggested a near-term rate cut remains a possibility.

“Expect Asian markets to start on the front foot,” said Nick Twidale, chief market analyst at AT Global Markets. “But given the moves that we saw last week, and the potential for more volatility in the coming days, investors will be understandably hesitant to throw the kitchen sink on positive risk sentiment.”

Markets saw a resurgence in volatility last week as doubts over the Fed’s ability to cut rates unsettled investors. Assets favored by retail momentum traders — including cryptocurrencies and AI-related stocks — swung sharply, while a selloff in Asian tech shares drove the MSCI Asia Pacific Index to its steepest weekly drop since April.

Wall Street wrapped up a chaotic week with a turnaround in stocks after a selloff that whipsawed some of the most-speculative corners of the market, testing investors’ nerves after a torrid rally.

US debt climbed on Friday after Williams, seen as a close ally to Chair Jerome Powell, said he sees room to ease policy in the near term, as downside risks to employment have increased while upside risks to inflation have eased. While traders boosted bets on a December cut, officials remained split on whether to lower rates, with Boston Fed chief Susan Collins indicating her mind isn’t made up about a policy move.