Futures Signal Early Weakness: Dow Jones, S&P, Nasdaq, Futures
U.S. stock futures pointed lower on Wednesday, suggesting Wall Street could open under pressure after a volatile trading session that ended with mixed results on Tuesday.
Investor sentiment has been affected by renewed concerns over the conflict in the Middle East following the latest military exchanges between the United States and Iran.
U.S. and Iran Exchange New Strikes
According to U.S. Central Command, American forces carried out what it described as “self-defense strikes” against Iranian targets on Tuesday under orders from President Donald Trump following the downing of a U.S. helicopter.
CENTCOM said the operation targeted Iranian air-defense systems, surveillance radar installations and ground-control facilities near the Strait of Hormuz using precision-guided munitions launched from U.S. Air Force and Navy fighter aircraft.
Iran responded by launching attacks against American military facilities in Kuwait, Bahrain and Jordan, while warning that it would leave no attack or threat unanswered.
In a subsequent Truth Social post on Wednesday morning, Trump argued that Iran had “taken too long to negotiate a deal” and would now have to “pay the price!”
Inflation Data Offers Some Relief
Futures recovered part of their earlier losses after the U.S. Labor Department released inflation data that largely matched economists’ expectations for May.
The report eased some concerns that price pressures may be accelerating more rapidly than anticipated, although geopolitical developments remained the dominant focus for investors.
Markets End Volatile Session Mixed
Tuesday’s trading session saw significant swings as investors reacted to both geopolitical headlines and economic data.
Major indices advanced early in the day before reversing sharply lower, only to recover part of those losses during afternoon trading.
The Nasdaq closed down 250.84 points, or 1%, at 25,678.82. The S&P 500 lost 19.08 points, or 0.3%, to finish at 7,386.65, while the Dow Jones Industrial Average added 86.10 points, or 0.2%, ending at 50,872.11.
Technology Stocks Lead Market Lower
The Nasdaq’s decline was driven largely by renewed weakness across the technology sector after a brief rebound on Monday.
Semiconductor companies were among the worst performers. The Philadelphia Semiconductor Index dropped 1.9% after surging 5.6% in the previous session.
Computer hardware, networking and software stocks also posted notable declines, adding to the pressure on technology-heavy benchmarks.
Falling Oil Prices Hit Energy Shares
Energy stocks also moved lower as crude oil prices fell sharply.
U.S. crude futures dropped below $90 per barrel after President Trump suggested that a peace agreement between Washington and Tehran could be reached within “two or three days.”
Trump also told reporters that the Strait of Hormuz would reopen “immediately” once an agreement is finalized, although similar predictions in recent weeks have yet to materialize.
Airlines and Housing Stocks Advance
Lower oil prices provided a boost to airline shares, with the NYSE Arca Airline Index climbing 3.7%.
Housing-related stocks also posted strong gains, pushing the Philadelphia Housing Sector Index up 3.6%.
The move followed new data from the National Association of Realtors showing that existing home sales in the United States rose more than expected in May.
NAR reported that existing home sales increased 3.2% to an annualized pace of 4.17 million units after rising 0.8% to a revised 4.04 million units in April.
Economists had forecast a 1.5% increase to an annual rate of 4.08 million units, compared with the originally reported April figure of 4.02 million.