Stock market today: Dow, S&P 500, Nasdaq futures pause rally after Iran says ceasefire has been broken
US stock futures fell on Thursday, backing off from a powerful rally driven by a US-Iran truce as the tentative ceasefire appeared increasingly fragile.
Dow Jones Industrial Average futures (YM=F) dropped roughly 0.4%, after the blue-chip benchmark closed out Wednesday over 1,300 points higher on the prospect of a reopening of the key Strait of Hormuz. Contracts on the S&P 500 (ES=F) and the Nasdaq 100 (NQ=F) also fell 0.4%.
The two-week pause in hostilities agreed by the US and Iran looks be in jeopardy as the two sides differ on what the deal entails.
It hinges on a key condition: the reopening of the Strait of Hormuz, a vital global oil shipping route that has been shut for weeks amid the conflict. While President Trump said there would be a “complete” lifting of Iran’s blockade, Tehran promised passage only “via coordination with Iran’s armed forces”.
But Iran has said continued and massive strikes by US ally Israel on Lebanon violated the one-day-old agreement, and tanker traffic through Hormuz has been halted. The growing tensions threaten to derail direct US-Iran talks planned for the weekend.
Oil prices rebounded from their biggest one-day since April 2020, rising 3% amid revived worries about supply disruption. International benchmark Brent crude futures (BZ=F) and their US counterpart West Texas Intermediate futures (CL=F) both traded at around $97 a barrel.
The first real read on the impact of war-boosted oil prices on US inflation comes Thursday, with the February print of the personal consumption expenditures price index — the Federal Reserve’s preferred inflation gauge. An update on weekly jobless claims will shed light on the health of the labor market.
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