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U.S. stock futures pointed lower on Wednesday, with investors closely watching escalating tensions in the Middle East following an Iranian missile attack on Israel. The potential for retaliatory strikes and disruption to oil supply has spooked markets, while futures for major indices show modest declines.
1. Futures Slide on Middle East Tensions
By 03:42 ET (07:42 GMT), U.S. stock futures were under pressure:
- Dow futures had fallen by 111 points, or 0.3%
- S&P 500 futures lost 8 points, or 0.1%
- Nasdaq 100 futures dropped 30 points, or 0.1%
These declines come after a volatile session on Tuesday, where Wall Street’s major indices took a hit due to geopolitical unrest. The Dow Jones fell by 174 points (0.4%), while the S&P 500 slipped by 54 points (1.0%), and the Nasdaq Composite retreated by 279 points (1.5%).
Despite the broader market weakness, energy stocks benefited from the oil price surge, and defense stocks such as Northrop Grumman and Lockheed Martin saw gains as the conflict escalated.
2. Iran Claims Missile Attack Over, Warns of Retaliation
Iran announced that its airstrike on Israel, the largest it has ever launched, was complete but warned of resuming attacks if further provocations occur. Israeli Prime Minister Benjamin Netanyahu has vowed retaliation, declaring that Iran “made a big mistake” and “will pay for it.”
There are concerns that Israel’s response may target critical infrastructure in Iran, including oil output facilities. The U.S. has expressed its support for Israel, with Defense Secretary Lloyd Austin warning of “severe consequences” for Tehran’s actions. The ongoing violence follows Israeli strikes on Hezbollah targets in Lebanon and the war in Gaza.
The United Nations, U.S., and European Union have all called for a ceasefire, but fighting continues.
3. Oil Prices Surge Amid Middle East Conflict
Oil prices surged on Wednesday, continuing a sharp rise from the previous session as fears over potential disruptions in Middle Eastern crude supply grew. By 03:43 ET:
- Brent crude climbed 2.6% to $75.50 per barrel
- WTI crude futures increased by 2.8% to $71.80 per barrel
Both benchmarks jumped more than 5% on Tuesday, reflecting the market’s concerns over how escalating tensions could impact the flow of oil from the region. An OPEC+ meeting is scheduled for later today, but no changes in output are expected.
Separately, U.S. crude inventories saw a decline of 1.46 million barrels for the week ending September 27, less than the expected drop of 2.1 million barrels.
4. Vance-Walz Debate Takes Center Stage
In U.S. political news, vice presidential candidates JD Vance and Tim Walz squared off in a debate on Tuesday night. Vance, the Republican running mate of Donald Trump, defended Trump’s economic record, while Walz, the Democratic nominee alongside Kamala Harris, focused on criticizing Trump’s repeated denial of his 2020 election defeat.
While the debate saw moments of tension, it was more civil compared to the heated exchange between Trump and Harris in their previous encounter.
