Iran struck U.S. and Israeli assets overnight — hedge funds took their worst hit since liberation day — and yet futures are pricing a 1.2% open. Gold fell. APAC surged. The market is treating this as a localized shock, not a global unwind. That thesis gets stress-tested Wednesday when the Fed hands down its rate decision.

Stocks edged higher. The S&P 500 closed 6,716.09 (+0.25%), the Nasdaq 22,479.53 (+0.47%), the Dow 46,993.26 (+0.10%), the Russell 2000 2,519.99 (+0.67%). Broad-based. All four major indices closed green. Elsewhere: Gold fell 0.60% to $4,971.00, the 10-year Treasury yield fell 2 bps to 4.20%, and WTI crude fell 2.01% to $94.28/bbl.

Geopolitics ran the session yesterday. Iran launches retaliatory strikes on Israel and U.S. assets after security chief Larijani is killed. Middle East escalation raises the risk premium across oil, shipping, and global supply chains — even headlines that don't immediately disrupt flows move markets. Investors reprice tail risk first, ask questions later.

Here's what this means for your portfolio. Oil's 2.01% decline is a quiet tailwind for consumer-facing sectors. Lower energy costs flow into margins for transportation (XTN), retail (XRT), and airlines.

Watch: geopolitical headlines — escalation or de-escalation will move oil, FX, and risk sentiment quickly.

Pre-market is pointing to a modest positive open (S&P +0.50% | Nasdaq +0.66% | Dow +0.46%). Futures are green but measured — not the conviction rip you'd expect if the market had fully shaken off the Iran shock. The Fed decision later today is likely keeping buyers cautious.

APAC closed broadly higher overnight — KOSPI led (+5.04%), while ASX 200 lagged (+0.31%).

Light calendar today (Durable Goods Orders). Direction comes from news flow and overnight follow-through — not data. Fed commentary or a headline shock could reset everything quickly.

For investors, the divergence creates clear positioning logic. The Iran war-premium is not being bought in traditional hedges — gold (GLD) failed to hold gains, defense names (ITA) may see rotation, and energy (XLE) faces a contradictory setup where geopolitical risk should push oil higher but the tape says otherwise. Bonds (TLT) never bought the risk-off story, which matters: if Iran escalates further, TLT is likely the fastest responder. Meanwhile, the Nvidia/OpenClaw AI catalyst is a legitimate near-term booster for semiconductors (SOXX, SMH) and could spill into Chinese AI names via KWEB after the 'next ChatGPT' framing went global. The software valuation warning from Orlando Bravo is a headwind for IGV — don't chase that segment today.

Going into today's open, S&P futures are up 1.19% at 6,801 and Nasdaq futures are ripping 1.43% — the AI narrative is doing the heavy lifting. APAC was the clearest signal: KOSPI surged 5% on the combination of Iran-war-premium relief and AI enthusiasm, a powerful risk-on cocktail. The swing factor today is binary: Durable Goods at 8:30 AM ET is a secondary data point, but the Fed decision Wednesday looms as the real volatility pin. Watch whether the futures gap holds through the cash open — if oil continues lower and gold stays flat while stocks surge, the rally has no geopolitical hedge attached, which means any Iran escalation headline mid-session could create a sharp reversal.