Trump Rejects Iran Peace Proposal, Crude Prices Soar

US stock index futures fell on Monday after President Donald Trump rejected an Iranian peace proposal, leading to a surge in crude oil prices.

The price of crude oil jumped 4% to around US$108 per barrel. This increase has rekindled inflation concerns and driven Treasury yields higher.

Economist Mohit Kumar at Jefferies stated that Trump's rejection suggests the two main issues of contention remain Iran's control over the Strait and its nuclear programme.

The 60-day rolling correlation between oil prices and Wall Street futures has climbed to its highest level since late May, according to LSEG data. This indicates energy markets and equities are becoming more sensitive to the same macro factors.