Futures tied to major U.S. indices pointed lower on Thursday, as uncertainty persisted over potential renewed talks between Washington and Tehran despite President Donald Trump’s decision earlier this week to extend a ceasefire. Meanwhile, oil prices remained above $100 per barrel amid continued disruptions in the Strait of Hormuz. Shares of Tesla (NASDAQ:TSLA) edged lower in after-hours trading, as solid earnings were overshadowed by increased spending plans for 2026.
Futures retreat
U.S. stock futures declined, pressured by lingering geopolitical tensions in the Middle East even after the ceasefire extension announcement.
By 03:32 ET, Dow futures were down 277 points, or 0.6%, S&P 500 futures had fallen 30 points, or 0.4%, and Nasdaq 100 futures slipped 104 points, also 0.4%.
Despite this, Wall Street had ended the previous session higher, moving closer to record levels. The extension of the ceasefire, combined with resilient corporate earnings, helped support sentiment.
Data compiled by Bloomberg showed that nearly 80% of S&P 500 companies reporting first-quarter results have exceeded expectations.
“[T]he main focus for risk assets is still the overall path that we’re on, which continues to lead towards the conflict coming to an end,” said Michael Brown, Senior Research Strategist at Pepperstone.
“[B]oth sides are now seeking an ‘off ramp’ to de-escalate proceedings, and that public remarks from each party are primarily aimed at obtaining greater negotiating leverage, as opposed to seeking a return to kinetic action. So long as that remains the direction of travel, risk appetite is likely to remain underpinned[.]”
Outlook for Iran talks remains unclear
Investors continued to watch for any indication of renewed diplomacy between the U.S. and Iran. Trump said discussions could resume, noting that negotiations are “possible” as soon as Friday.
Earlier in the week, he stated via social media that the ceasefire had been extended at Pakistan’s request, as the country continues to mediate between the two sides. Trump added the truce would remain in place “until such time as” Iran presents a “unified proposal” for peace.
However, uncertainty remains high. Shortly after the announcement, Iran attacked three vessels and seized two near the Strait of Hormuz, in response to the ongoing U.S. blockade of its ports.
Oil climbs back above $100
Fears of further supply disruptions through the Strait of Hormuz—through which roughly 20% of global oil flows—pushed crude prices back above $100 per barrel.
“The reassuring element is that at least one party – the U.S. – is signaling a strong desire to resume negotiations swiftly. What is less reassuring is the lack of clarity around plans for reopening the Strait of Hormuz,” analysts at ING said.
They added that if hopes for a resolution continue to fade, “the reality of supply disruption will set in, leaving further upside for prices.” In the absence of progress, markets could become “increasingly numb to the noise and headlines that have dictated price action recently.”
Although oil prices have retreated from the initial surge following the outbreak of conflict in late February, they remain significantly above pre-war levels, raising concerns about inflation and global growth.
Tesla slips despite earnings beat
Tesla (NASDAQ:TSLA) reported quarterly results that exceeded expectations on both revenue and profit, with its automotive segment performing better than anticipated.
However, the stock turned lower in after-hours trading after the company outlined plans to invest more than $25 billion this year to support a strategic shift toward robotics and autonomous driving. This compares with prior guidance of $20 billion in capital expenditures.
Shares were last down 1.8% in extended trading, reversing an earlier gain of more than 4%.
CEO Elon Musk also tempered optimism around the transition. During the earnings call, he said he could not estimate production levels for the Optimus robot in 2026, citing challenges in repurposing manufacturing lines previously used for the discontinued Model S/X.
“Optimus is a completely new product with a completely new production line. It’s just literally impossible to predict,” Musk said, adding that output would likely be “quite slow at first.”
He also emphasized a “cautious approach” to Tesla’s autonomous driving and robotaxi ambitions, noting that revenue from these initiatives will “not be super material” this year.
Earnings and data in focus
Investors are also looking ahead to additional earnings releases before the opening bell, including from American Express and Lockheed Martin, while Intel is scheduled to report after the close.
On the macro front, upcoming U.S. PMI data for April will offer insight into how businesses are coping with rising cost pressures linked to the Iran conflict.
In March, the purchasing managers’ index fell to 50.3 from 51.9, marking its lowest level since September 2023.
At the time, S&P Global’s Chief Business Economist Chris Williamson said the data showed “the U.S. economy buckling under the strain of rising prices and intensifying uncertainty, as the war in the Middle East exacerbates existing concerns regarding other policy decisions in recent months, notably with respect to tariffs.”