Crude oil futures pulled back below the $68-a-barrel mark after jumping about 5% in the New York session on Wednesday amid escalating geopolitical tensions between the U.S. and Iran.

U.S. stocks appear on track to extend losses, with the major index futures trading moderately lower amid the intensifying uncertainty surrounding the Trump tariffs.

President Donald Trump told reporters late Wednesday that he would send letters individually to trading partners within the next couple of weeks regarding unilateral tariff rates. The threat came shortly after he touted success with China trade talks.

That said, Oracle Corp.’s (ORCL) strong quarterly results could perk up sentiment toward artificial intelligence (AI) plays, cushioning any potential downside.

As of 10:24 p.m. ET on Wednesday, the S&P 500, Nasdaq 100, and Dow futures were all down about 0.40%, while the Russell 2000 futures fell a steeper 0.85%.

Crude oil futures pulled back below the $68-a-barrel mark after jumping about 5% in the New York session on Wednesday amid escalating geopolitical tensions between the U.S. and Iran. Golf futures surged over 1.50%, approaching the $3,400 level. 

The U.S. dollar weakened against most major currencies amid Trump’s threat of unilateral tariffs.

The 10-year U.S. Treasury yield, which spiked past 4.5% following last week’s monthly non-farm payrolls report, continued to weaken. In the overnight session, the yield retreated below 4.4%, dragged by a tame inflation report.

The Bureau of Labor Statistics (BLS) will release the May producer price inflation report at 8:30 a.m. ET. Also on tap is the weekly initial jobless claims data, with the number of individuals claiming unemployment benefits expected to edge down slightly to 246,000.

Adobe (ADBE), RH (RH), and Lovesac (LOVE) are due to report their quarterly results on Thursday.

A market strategist cautioned that the recent market rally is on shaky ground. Morgan Stanley Chief Investment Strategist Lisa Shalett said uncertainties abound regarding tariff policy and contentious legislation, including President Donald Trump’s “One Big, Beautiful” tax bill, debt ceiling raise, and bank regulation.

The strategist also flagged rising geopolitical tensions in the Middle East and Russia and the stalling of the Iran-U.S. nuclear deal.

Shalett also questioned the market’s bullish assumptions on earnings growth, profit margins, capital spending and productivity gains.

Stocks snapped a three-session rally on Wednesday before ending lower, as the early optimism generated by the May consumer price inflation report gave way to apprehension. The deterioration in sentiment came amid investor worries about tariff uncertainty and rising geopolitical tensions.

Most S&P 500 sector classes declined during the session, except for energy, defensive healthcare, industrial, and utility stocks.

The Invesco QQQ Trust (QQQ) ETF and the SPDR S&P 500 ETF (SPY) moved down 0.34% and 0.29%, respectively.

The SPDR Dow Jones Industrial Average ETF Trust (DIA) ended little changed with a negative bias, while the iShares Russell 2000 ETF (IWM) ended 0.41% lower.

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