Wall Street futures climbed Monday after the United States and Iran announced a pause in hostilities over the weekend, driving oil prices sharply lower and boosting risk appetite ahead of a week of major earnings, economic data and an interest rate decision.

A wide swathe of stocks sensitive to energy prices rose in premarket ‌trading. United Airlines and Southwest Airlines were up 4% and 3.6%, respectively. Cruise operators Royal Caribbean and Carnival rose ​2.4% and 3.2%, respectively.

A 7.8% slide in Brent Crude prices to $89.23 a barrel weighed on shares of energy companies. Occidental Petroleum and Exxon Mobil were down 4% and 3.1%, respectively.

Markets ended last week rattled ⁠by escalating Middle East tensions, with investors worried the conflict could fuel further price pressures ahead of the Fed's monetary ​policy decision due on Wednesday.

Despite the announcement of the pause in attacks, shipping through the crucial Strait of Hormuz remained low. ⁠Attacks by Yemen's Iran-aligned Houthis on Saudi oil installations along the Red Sea coast, another waterway vital to the global oil trade, also kept traders on edge.

The Fed has offered few clues on monetary policy outlook since Kevin Warsh took over as chair, fueling uncertainty over the path ahead for interest rates.

Investors ‌are pricing in at least 25 basis points worth of rate hikes this year, with a 31% chance ​it could come ‌as early as this week, LSEG-compiled data showed.

Data on June durable goods is expected later on Monday and the Personal Consumption Expenditures Price Index is due a day after the central ‌bank's decision. The Fed's preferred inflation gauge will likely play a key role in shaping market expectations for interest rates later this year.

"Policymakers face a difficult trade-off between evidence that inflation had been moderating and growing signs that higher oil ⁠prices could create a more persistent inflation shock," analysts ‌at Deutsche Bank said in a note.

Stock futures rose sharply as of 8:27 a.m. EST. S&P 500 futures gained 59.50 points, or 0.80%, to 7,507.00.

Dow futures jumped 543 points, or 1.04%, to 52,667.00. Nasdaq futures surged 368 points, or 1.30%, to 28,650.25, while Russell 2000 futures climbed 29.40 points, or 1.00%, to 2,970.70.

Earnings from several Magnificent Sevencompanies, including Microsoft, Amazon.com, Meta and Apple, ‌will test the AI trade further this week.

Microsoft, Amazon and Meta were up over 1% each, while Apple edged up 0.3%. Among chip stocks, Applied Materials gained 4.3%, Western Digital added 3.4% and industry leader Nvidia rose 0.7%.

Negative cash-flow reports from Alphabet and Tesla last ‌week added to ​concerns about debt-fueled corporate spending on developing ‌technology. Chinese chipmaker CXMT Corp's stellar debut also signaled intensifying competition for the U.S. semiconductor industry.

The tech-heavy Nasdaq is down 8% from its record high, while earlier this month the Philadelphia SE Semiconductor Index confirmed it has been ​in "bear market" territory since late June.

An index closing 10% below its most recent record high is called a technical correction, while a 20% drop is referred to as a bear market.