U.S. stock futures slipped early Monday after renewed military strikes between the United States and Iran triggered fresh concerns about geopolitical risks and rising oil prices. Dow Jones futures fell 64 points, or 0.12%, while S&P 500 futures declined 0.1% and Nasdaq 100 futures were marginally lower as investors assessed the potential impact of the renewed conflict on global markets.
The latest escalation came after the U.S. confirmed strikes on two rocket launchers on Iran’s Larak Island. Iranian state media also reported that Tehran had retaliated by attacking U.S. bases in Jordan. The exchange of strikes marks the first publicly acknowledged U.S. attack on Iranian positions since late July, raising concerns that tensions in the Middle East could intensify further and create new pressure on financial markets.
Oil prices responded quickly to the development, with U.S. West Texas Intermediate crude rising 3.4% to $86.25 a barrel, while Brent crude climbed 3.6% to $91.24. The jump is particularly significant for investors because prolonged disruption in the Middle East could push energy prices higher, potentially adding to inflationary pressure and complicating expectations around interest rates.
Despite Monday’s cautious start, Wall Street remains on course for a strong month. The Dow has gained 2.1% in August and is heading for its fifth straight monthly advance, while the S&P 500 and Nasdaq Composite have risen about 3% and 4%, respectively. Technology stocks have led the rally, with the S&P 500 technology sector gaining nearly 6%, while Nvidia, Microsoft and Micron Technology have posted gains of more than 8%, 11% and 13%, respectively.
Investors are now turning their attention to this week’s economic data, particularly the U.S. jobs report due Friday, alongside manufacturing and services figures. Markets will also watch inflation and Federal Reserve signals closely after Fed Chairman Kevin Warsh warned that recent inflation readings have not yet shown a meaningful improvement. With geopolitical tensions pushing oil prices higher, investors face a delicate balance between strong corporate performance, inflation risks and the possibility of tighter monetary policy.
source: cnbc
