Futures Slide as Oil Surge and Middle East Tensions Overshadow Earnings
U.S. equity futures pointed lower on Thursday as higher energy prices tied to escalating Middle East hostilities revived worries about inflation and borrowing costs. Early post-earnings gains in Tesla, Meta, IBM and Texas Instruments faded, with Meta falling after it announced a new share class to help finance AI spending. Asian and European benchmarks also weakened while crude prices climbed.
Ahead of the open, Dow futures were 322 points lower, S&P 500 futures were off 75.25 points and Nasdaq futures were down 481.50 points. Brent climbed 2.8% to $111.88 a barrel and WTI added 2.4% to $99.48, while Japan’s Nikkei lost 2.65%, Hong Kong’s Hang Seng fell more than 3% and South Korea’s Kospi dropped 3.7%. European benchmarks also retreated.
Initial post-close gains in Tesla, Meta, IBM and Texas Instruments faded as broad economic concerns took over. Meta topped estimates, reported its highest combined sales and lifted the bottom of its capex forecast, but a new stock category aimed at financing artificial-intelligence outlays weighed on its shares.
Higher crude prices tied to Middle East tensions could feed through to fuel and transport costs, leaving households with less discretionary spending and businesses facing tighter margins. Renewed inflation worries may keep borrowing costs elevated, affecting mortgage seekers, small firms and indebted consumers. Market swings could also influence retirement and investment accounts, while energy-producing firms and oil exporters may see different effects. The situation remains fluid, so these outcomes are possible rather than certain.