Dow Jones and Nasdaq poised to drop back as oil spikes on US seizure of Iranian ships
US stock futures are pointing to a softer open on Thursday, as oil prices climbed on the back of the US seizing three Iranian ships some way outside the Strait of Hormuz.
The Dow Jones was seen heading down 0.6%, while futures for the S&P 500 and the Nasdaq were both off 0.4%.
Markets finished the prior session on a strong note, with the Nasdaq marching at the front up 1.6% to close at a new record high 24,658, powered largely by strength in semiconductor stocks, with the S&P 500 rising 1.1% to its own all-time high as it closed at 7,138. The Dow Jones lagged, but delivered a gain of 0.7% as it ended at 49,490.
The dollar was firmer on safe-haven demand, while WTI crude oil rose 1.1% just below $94 a barrel, up from below $85 at the end of last week.
US Central Command confirmed three more Iranian vessels had been intercepted, taking the total blocked by the blockade to 31.
The US Navy was reported to have redirected the three ships away from positions near India, Malaysia and Sri Lanka, in what analysts said was the first time the naval blockade had reached beyond the Strait of Hormuz, and comes after two container ships were stopped by Iranian forces the day before.
There seemed to be little progress on talks with Iran either, with President Masoud Pezeshkian saying Tehran wants “dialogue and agreement” but the US “breach of commitments, blockade and threats are the main obstacles to genuine negotiations”, while lead negotiator Mohammad Ghalibaf said it is “not possible to reopen the Strait of Hormuz considering all the blatant violations of the ceasefire”.
For investors, earnings in focus today include Tesla’s numbers released overnight, with the shares down 3% in premarket trading despite earnings beating Street forecasts.
IBM also beat on quarterly numbers, but the outlook seemed to disappoint, with shares down almost 7% premarket,m
Results are due later from names including American Express, Thermo Fisher, NextEra Energy, Union Pacific, Honeywell, Lockheed Martin, Sanofi, Comcast, Blackstone and Freeport McMoRan. Intel and SAP are due after the close.