The U.S. launched fresh strikes on Iran on Wednesday, even as the war in the Middle East has stretched over 100 days now.
- Iran announced the closure of the Strait of Hormuz in response to the latest U.S. attacks, but CENTCOM and President Trump denied the closure claims.
- U.S. stock futures declined at the time of writing, while oil prices edged higher in response to the tensions.
- On Thursday, markets will be watching out for the Producer Price Index (PPI) report after May’s consumer inflation came in at a three-year high.
U.S. stock futures fell in the overnight session late Wednesday, extending a decline from the close as the U.S. military’s fresh “self-defense” strikes against Iran and the highest inflation numbers in three years weighed on investor sentiment.
Earlier in the day, U.S. President Donald Trump said in a post on Truth Social that America is in control of the critical Strait of Hormuz, and it is “over for Iran” as the country’s “military is defeated, and their economy is lost.” Oil prices were climbing higher in the extended trading hours.
The Dow futures declined by 0.10%, the S&P 500 futures fell 0.04%, while the Nasdaq 100 futures traded 0.13% lower as of 8.50 p.m ET.
Among ETFs tracking benchmark indexes, the SPDR S&P 500 ETF (SPY) and the Invesco QQQ Trust (QQQ) were edging higher at the time of writing amid ‘bearish’ sentiment for both. The SPDR Dow Jones Industrial Average ETF Trust (DIA) declined.
Meanwhile, the iShares 20+ Year Treasury Bond ETF (TLT) was trading 0.17% lower amid ‘neutral’ sentiment at the time of writing.
How Did US Markets Fare On Wednesday?
On Wednesday, all three benchmark indexes closed lower amid a broader rout in chip and technology stocks. The Nasdaq led the decline, shedding more than 500 points to close nearly 2% lower. The Dow closed down 1.87%, while the S&P 500 was down 1.62% at close.
| Index | Move | Close |
| Dow Jones Industrial Average | -1.87% | 49,918.78 |
| S&P 500 | -1.62% | 7,266.99 |
| Nasdaq Composite | -1.98% | 25,169.50 |
US Market Drivers
The U.S. military launched a fresh round of attacks on Iran, with the U.S. Central Command forces calling it “additional self-defense strikes” against multiple targets in Iran in response to its “unwarranted and continued aggression.”
Earlier on Wednesday, Trump said at the White House that Iran would be struck "very hard" and would "pay the price" for stalled talks, even as the war has stretched over 100 days. Trump’s comments followed U.S. attacks on Iran on Tuesday in response to the downing of an Apache helicopter over the weekend.
Meanwhile, Iran announced the closure of the Strait of Hormuz in response to the latest U.S. attacks, with the Islamic Revolutionary Guard Corps saying that it had targeted two vessels that attempted to cross the critical waterway.
However, the CENTCOM quashed the claims, saying that the reports were false and that commercial ships are continuing to transit in and out of the Strait. The president also said in a post on Truth Social that the U.S. military has supported the transit of commercial ships through the Strait of Hormuz, helping more than 100 million barrels of oil reach the open market.
“More than 200 Commercial Ships have safely traveled through the Strait. This wildly successful effort is because the UNITED STATES of AMERICA CONTROLS the Strait of Hormuz — NOT Iran,” he said.
In a separate post, Trump said, “NOTHING GETS THROUGH unless we want it to. IT IS A STEEL WALL! Iran is doing ZERO business, not paying their military, or any of their bills, and quickly becoming a FAILED NATION! Lots of oil is getting out.”
Meanwhile, May’s consumer price index showed that annual inflation was at 4.2% before seasonal adjustment, the highest level since April 2023. The rising inflation weighed heavily on investor concerns.
“Americans are getting squeezed financially by inflation that’s back at a 3-year high,” Heather Long, chief economist at Navy Federal Credit Union, reportedly told CNBC.
“The frustration for many Americans is that so many of the basics are up in price right now -- gas, food, electricity, and medical care are all clear pain points that are above 3% inflation. Ending the war in Iran will help to moderate inflation, but the worst is likely still to come for rising food prices,” Long said.
On Thursday, the Producer Price Index (PPI) report will provide further insight into rising prices. Investors will also be tuned into the impact of SpaceX’s debut, slated for Friday, on markets.
Trending Stocks To Watch
Oracle Corp. (ORCL): Shares of the hyperscaler declined nearly 11% in overnight hours after the company announced its fourth-quarter results. Softer-than-expected guidance failed to impress, and an additional $20 billion fundraise overshadowed a Q4 double-beat.
Trump Media & Technology Group Corp. (DJT): The president’s media company jumped onto the retail radar after it announced that it had shelved plans to spin off Truth Social and other media assets into a separate publicly listed company.
Super Micro Computer Inc. (SMCI): Shares of the company extended declines for two consecutive days, closing nearly 28% lower as its massive $7 billion equity and equity-linked financing package weighed on sentiment.
Tesla Inc. (TSLA): The EV maker jumped onto retail’s radar after it apparently began delivering its most affordable Cybertrucks to early customers this month after years of delays, according to social media posts. The Elon Musk-led company also garnered attention ahead of the SpaceX IPO.
Global Market Trends
Oil futures climbed higher in the overnight session on Wednesday as the fresh attacks on Iran raised concerns about a prolonged closure of the Strait of Hormuz.
Brent crude futures expiring in August gained more than 2% to trade at around $95.10 a barrel at the time of writing, while WTI crude futures expiring in July rose about 2.5%, trading around $92.26 a barrel.
Meanwhile, yields on the 10-year Treasury rose to 4.562%, and gold prices were trading at around $4,075.88 an ounce.
Asian markets declined at the opening on Wednesday, with South Korea's KOSPI, Japan’s Nikkei 225, the SSE Composite index and Australian stocks all edging lower.
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