Dow futures drop 500 points after Trump announces Strait of

Dow futures drop 500 points after Trump announces Strait of Hormuz blockade as talks fail U.S. stock futures tumbled on Sunday night after President Donald Trump announced a blockade of the Strait of Hormuz, as peace talks between the U.S. and Iran over the weekend ended without a deal.

Dow Jones Industrial Average futures dropped by 517 points, or 1.1%. S&P 500 futures lost 1.1% and Nasdaq 100 futures shed 1.2%.

“Effective immediately, the United States Navy, the Finest in the World, will begin the process of BLOCKADING any and all Ships trying to enter, or leave, the Strait of Hormuz,” Trump wrote on Truth Social. “The Blockade will begin shortly. Other Countries will be involved with this Blockade. Iran will not be allowed to profit off this Illegal Act of EXTORTION.”

The breakdown of negotiations over the weekend in Islamabad reignited worries that the U.S.-Iran war will last longer than feared, leading to higher oil prices that will continue to strain economies worldwide.

WTI crude oil jumped 7.9% to $104.19 a barrel as trading began Sunday.

U.S. central command said it will begin blocking all maritime traffic in and out of Iran’s ports at 10 a.m. ET Monday. The U.S. said it will not block vessels using the strait to get to non-Iranian ports.

Vice President JD Vance left Islamabad without a deal with his Iranian counterparts, citing their unwillingness to stop the pursuit of nuclear weapons. But both sides appear farther apart than just that issue with Iran demanding control of the Strait of Hormuz, war reparations and the release of frozen assets. Pakistan officials said they would try to restart talks in coming days.

Trump, who announced the naval blockade after talks broke down, is weighing resuming military strikes, the Wall Street Journal reported, citing officials familiar with the situation.

“The new blockade statement is an overt signal to equity markets that the Iranian conflict remains uncertain, yet traders are viewing this development as negotiation tactic versus an actual policy implementation, or as a long-term solution for the Strait of Hormuz,” said Jeff Kilburg, CEO of KKM Financial.

Kilburg said it’s possible more buyers come in before the market opens Monday.

Hopes for a swift end to the war helped all three major benchmarks post their best week since November, following the announcement of a two-week ceasefire between the U.S. and Iran. The S&P 500 rallied 3.6% last week, while the Nasdaq jumped about 4.7%. The Dow gained 3%.

First-quarter earnings season unofficially kicks off this week. The nation’s largest banks will get it started, with Goldman Sachs slated to release results on Monday. Citigroup, Wells Fargo, JPMorgan Chase, Morgan Stanley and Bank of America are all on the docket later this week.