US pre-open: Futures lower as investors eye earnings, Iran tensions

(Sharecast News) - Wall Street futures were in the red ahead of the bell on Thursday following yesterday's record setting session. As of 1245 BST, Dow Jones futures were down 0.55%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.38% and 0.36% lower, respectively.

The Dow closed 340.65 points firmer on Wednesday, while the S&P 500 and Nasdaq Composite hit fresh record highs.

Electric carmaker Tesla was drawing an amount of investor attention prior to the open after posting first‑quarter earnings after the close on Wednesday that came in ahead of expectations, although revenue fell short as the firm continued to face pressure on its core automotive business, while IBM was also in focus after reporting Q1 results that came in ahead of market expectations, with revenues rising 6% at constant currency.

Investors looked set to be zeroed-in on another batch of quarterly earnings from a number of the nation's biggest companies on Thursday, with American Express, Union Pacific, Honeywell, Blackstone, American Airlines and Lockheed Martin all scheduled to report before the open, while Intel will release its latest quarterly earnings after the close.

However, geopolitical tensions in the Middle East also remaied in focus after a lack of commitment from Iran reportedly led to JD Vance cancelling his trip to join peace talks. Iran state media also reported that Iranian negotiators declined to attend, calling talks with the US a "waste of time". On Wednesday, Iran's navy claimed to have seized two container ships in the Strait of Hormuz, sending benchmark Brent crude 1.0% higher at $102.93 per barrel and West Texas Intermediate up 1.04% at $93.93 a barrel.

Trade Nation's David Morrison said: "So far, today's pullback appears to be little more than a mild bout of profit-taking triggered by some worrying reports of hostile action between the US and Iran. Reports emerged that Iranian forces had seized two container ships in the Strait of Hormuz. Following this, it appears that the US military intercepted at least three Iranian oil tankers in Asian waters.

"These acts have taken place straight after President Trump announced an indefinite extension to the current ceasefire. This was on the basis that Tehran's leadership was 'fractured' and so the US was prepared to give them extra time to return to negotiations. As far as Iran is concerned, officials have branded further talks a 'waste of time', particularly as the US Navy continues the blockade of Iranian ports across the region. This action may prove fruitful for the US if it cuts off Iran's ability to sell and export its crude oil production. But it is worth noting that this is an existential situation for Iran's current leadership, and as such, the calculation seems to be that Tehran's capacity to absorb economic pain is leagues above that of the US."

On the macro front, the Chicago Federal Reserve's March national activity index will be published at 1330 BST, as will weekly jobless claims from the Labor Department, while preliminary readings of S&P Global's April manufacturing, services and composite PMIs will be released at 1445 BST and the Kansas Fed's April manufacturing index will follow at 1600 BST.







Reporting by Iain Gilbert at Sharecast.com