US stock index futures were mixed on Thursday as investors monitored rising oil prices and the escalating conflict in the Middle East, developments that could complicate the Federal Reserve’s path toward interest rate cuts.
Futures tied to the S&P 500 was up about 0.01%, while Nasdaq 100 futures also rose by 0.04%.
Dow Jones Industrial Average futures slipped roughly 70 points, or about 0.14%, as traders paused following strong gains in the previous session.
Markets remain sensitive to energy prices and geopolitical developments as the conflict involving Iran entered its sixth day.
The prospect of prolonged instability in the region has raised concerns that higher oil prices could push inflation upward, potentially limiting the Federal Reserve’s flexibility on monetary policy.
Oil prices rise as Middle East conflict continues
Energy markets continued to reflect the geopolitical uncertainty.
West Texas Intermediate crude futures rose about 2.92% to $76.84 per barrel, while Brent crude gained roughly 2.4% to trade near $83.35 per barrel.
Oil prices had surged earlier in the week before stabilizing slightly, but traders remain focused on developments around the Strait of Hormuz, a strategic shipping route responsible for roughly 20% of global oil supply.
Fears of major disruptions eased somewhat after President Donald Trump said the United States is preparing to provide escorts and risk insurance for ships operating in the Persian Gulf.
Despite the measures, uncertainty remains high.
Defense Secretary Pete Hegseth said in a briefing that the United States is “winning decisively” in its conflict with Iran and noted that additional forces are arriving in the region.
The possibility of shipping disruptions continues to weigh on the global economic outlook.
A prolonged conflict that pushes crude prices toward $100 per barrel could increase energy and transportation costs, adding inflationary pressure at a time when tariffs and trade tensions are already complicating the economic picture.
According to LSEG data, investors now expect the Federal Reserve to delay a potential 25-basis-point interest rate cut until September, rather than July.
Technology outlook supports market sentiment
Despite geopolitical uncertainty, technology stocks have helped support broader equity markets this week.
Broadcom projected that its artificial intelligence chip revenue could exceed $100 billion next year, sending the company’s shares up 6.5% in premarket trading and providing a boost to sentiment in the semiconductor sector.
The gains follow a broader rebound in technology stocks after February’s selloff.
Chip stocks were down in premarket trading, with Nvidia trading down 0.3% and Advanced Micro Devices slipping about 0.9%.
The recovery in technology shares has helped US markets outperform their European and Asian counterparts in recent sessions.
Market sectors react to energy and geopolitical risks
Sector performance reflected the impact of higher energy prices and global tensions.
Travel stocks, which are particularly sensitive to fuel costs, traded mixed.
American Airlines slipped 0.88%, while cruise operator Carnival edged 0.5% higher.
Energy companies saw modest gains, with Cheniere Energy and Valero Energy trading higher by 1%.
Defense stocks also advanced amid the ongoing conflict.
Shares of RTX and Aerovironment rose between 0.4% and 1.5%.
Meanwhile, safe-haven assets drew interest from investors seeking protection from volatility.
Precious metals prices edged higher, lifting gold miners Harmony Gold and Alamos Gold by about 1.2% and 2.1% respectively.
Market participants are now awaiting fresh economic data and commentary from policymakers.
Remarks from Federal Reserve Vice Chair Michelle Bowman are expected later in the day, alongside the weekly jobless claims report.
Attention will then turn to Friday’s nonfarm payrolls report, which could provide further clues about the strength of the US labor market and the outlook for interest rates.
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