Dow, S&P 500, Nasdaq futures sink, oil prices surge as markets react to Iran conflict
U.S. stock futures fell Sunday night as oil prices rose as coordinated U.S. and Israeli military strikes on Iran rattled global markets.
Futures tied to the Dow Jones Industrial Average (YM=F) fell nearly 1%, or more than 500 points. S&P 500 (ES=F) and Nasdaq 100 futures (NQ=F) also fell around 1%.
The attack took place late Saturday after Tehran rejected US demands to reduce its nuclear program. Iranian leaders have vowed a strong response, raising the possibility of a broader regional conflict.
Oil markets reacted immediately. International benchmark Brent crude futures (BZ=F) were trading around $80 a barrel, up roughly 13% in early trading, while U.S. benchmark WTI (CL=F) was trading around $73. Iran is OPEC’s fourth largest producer and questions remain about political leadership and stability following the death of Supreme Leader Ali Khamenei. Gold (GC=F) futures also jumped.
The geopolitical shock further adds to an already fraught environment for stocks. The S&P 500 (^GSPC) finished lower on Friday and ended February in negative territory as renewed volatility in artificial intelligence and software stocks rattled markets. Investors are increasingly questioning whether the rapid adoption of artificial intelligence could undermine the business models of traditional software companies.
The week’s economic calendar includes Friday’s February employment report; Wall Street expects the U.S. to add 60,000 new jobs, with a stronger-than-expected 130,000 gain in January easing recession fears.
In corporate news, earnings season continues with Broadcom (AVGO) reporting on Wednesday and Marvell Technology (MRVL) reporting on Thursday. Retail earnings will also be in focus, led by Target (TGT) and Costco (COST).
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