US Stocks Today | Wall Street futures slide as Middle East conflict stokes inflation worries

The Nasdaq led losses among U.S. stock index futures with a 2.3% drop on Tuesday as investors assessed the fallout of U.S. and Israeli strikes on Iran on inflation and global trade.

Tehran's threat to attack any vessel attempting to ‌transit the Strait of Hormuz, ⁠combined ⁠with production halts by several Middle Eastern oil and gas producers, has driven global shipping rates higher and pushed up crude and natural gas prices.

The strait, a critical chokepoint, carries roughly one-fifth of the world's total oil consumption.


Industries such as airlines and travelthat are exposed to crude prices were knocked back for a second day. Delta and Royal Caribbean fell about 4% each.

"Much will depend on the price of oil," said a group of strategists led by Deutsche Bank's Jim Reid. "Any sustained spike would undoubtedly trigger a more meaningful risk-off move."

Technology stocks such as Nvidia and Microsoft were down 3.1% and ⁠1.8%, respectively, ‌after gaining in the previous session. Nasdaq-listed memory names such as Sandisk slumped 8.4% and Western Digital lost 5.6%, also cooling off from a strong rally in February.

Investors were worried that higher oil prices ⁠could stoke inflation across the broader economy and further complicate policy decisions for central bank officials already contending with price increases driven by tariffs.

The U.S. 10-year Treasury yield touched its highest level in more than a week and investors pushed back expectations for a 25-basis-point interest rate cut by the Federal Reserve to September from July, according to LSEG-compiled data.

Markets will be looking out for fresh signals from the Fed, given recent divisions over the path of rates. John Williams, a voting member, Jeffrey Schmid, and Neel Kashkari are scheduled to speak later in the day. At 05:59 a.m. ET, Dow E-minis were down 858 points, or 1.76%, S&P 500 ‌E-minis were down 124.5 points, or 1.84%. Nasdaq 100 E-minis were down 579.5 points, or 2.32%

Futures tracking the small-caps index slid 2.8%, while Wall Street's fear gauge, the CBOE volatility index , spiked to a fresh three-month high of 26.99 points.

Oil and ⁠gas as well as defense stocks were among the few gainers. Occidental rose 3.7% and Cheniere Energy climbed 9.8%, while Lockheed Martin gained 1.4% and AeroVironment added 2.7%. Prices of traditional safe-havens such as precious metals slid due to a stronger dollar, pulling down U.S.-listed miners such as Sibanye Stillwater and Gold Fields by 12% and 9%, respectively.

U.S. investors are also navigating uncertainties about the scope of disruption AI models could have on traditional businesses, alongside jitters in the private credit space. MongoDB shares plunged 27.4% after the database software company forecast quarterly profit below Street estimates. A packed slate of U.S. data will land later this week, including January retail sales, ADP employment figures and the closely watched non-farm payrolls report.