Stock futures slipped Wednesday as oil prices surged to their highest levels in over a month, driven by ongoing U.S. military strikes against Iran, while investors braced for a heavy afternoon of earnings from major technology companies.
Brent crude briefly topped $95 a barrel Wednesday after an 11th consecutive night of U.S. strikes against Iran, with Fed rate hike odds climbing
Michael Nagle/Bloomberg via Getty Images
Stock futures slipped Wednesday as oil prices surged to their highest levels in over a month, driven by ongoing U.S. military strikes against Iran, while investors braced for a heavy afternoon of earnings from major technology companies.
Brent crude futures jumped 4.8% to $94.93 a barrel, touching $95 at the session high. West Texas Intermediate futures were up more than 4% to $88.12 a barrel. Dow Jones Industrial Average futures were off 31 points, just below flat, with S&P 500 futures losing 0.3% and Nasdaq $NDAQ-100 futures dropping 0.6%.
The oil move followed an 11th consecutive night of U.S. strikes against Iran. Secretary of State Marco Rubio said Iran is "not serious about talks." "If they're serious, we're serious. If they're not, then we will do what is necessary to protect our interests and also the interests of our allies," Rubio said. Brent futures are now trading more than $20 above their early-July lows, and average gas prices at the pump have risen above $4 a gallon, according to The Wall Street Journal.
The oil surge is stoking worries that stubbornly high energy costs will feed through to broader prices, potentially giving the Federal Reserve reason to resume raising rates. Markets were assigning a 24.1% probability to a rate increase at this month's Fed meeting and a 69% likelihood of at least a quarter-point move in September, CME $CME's FedWatch tool showed. The likelihood of a hike at this month's meeting has risen from roughly 16% at the start of the week, according to The Journal.
After Wednesday's close, Alphabet $GOOGL, Tesla $TSLA, International Business Machines, ServiceNow $NOW, Texas Instruments $TXN and AT&T $T are all scheduled to post results. Wall Street will scrutinize those reports for clues about artificial intelligence investment trajectories, cloud growth and enterprise tech demand as companies look toward the back half of 2026.
"Q2 earnings season is ramping up, but with most hyperscalers yet to report, the market is still waiting for the definitive read on how AI investment is being monetized and translated into future capital spending," Julia Hermann, global market strategist at New York Life Investment Management, told CNBC.
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