U.S. stock futures were muted early Wednesday as investors weighed geopolitical tensions, cautious monetary signals from Federal Reserve Chair Jerome Powell, and a weaker-than-expected profit forecast from delivery giant FedEx. Oil prices edged higher but remained near recent lows as the Israel-Iran ceasefire appeared to hold.
U.S. Futures Flat Amid Geopolitical Calm
At 03:40 ET, U.S. equity futures saw limited movement:
- Dow futures rose 33 points (0.1%)
- S&P 500 futures were flat
- Nasdaq 100 futures edged up 19 points (0.1%)
The prior session saw gains on Wall Street as hopes mounted that a truce between Israel and Iran—brokered by President Donald Trump—could lead to lasting de-escalation after 12 days of cross-border strikes.
Traders are also cautiously tracking a July deadline for sweeping U.S. reciprocal tariffs, with trade tensions looming large despite investors’ relative calm. Analysts at Vital Knowledge noted that markets are pricing in “no more than a 10% baseline tariff” from ongoing trade actions.
Ceasefire Holds but Risks Remain
The ceasefire, announced by Trump on Tuesday, remained in effect despite accusations that both Israel and Iran had violated its terms shortly after it began. Trump claimed U.S. strikes had “obliterated” Iran’s nuclear facilities, though intelligence reports suggest the damage was limited and the program only delayed by months.
Trump envoy Steve Witkoff expressed optimism that talks with Iran could soon lead to a broader peace agreement. “I am very confident that we are going to achieve that,” he said in a Fox News interview.
Oil Prices Tick Up on Ceasefire Resilience
Oil prices rose modestly:
- Brent crude: +1.7% to $67.30/barrel
- WTI crude: +1.8% to $65.53/barrel
Despite the gains, crude remains near multi-week lows as hopes of de-escalation ease fears of a supply shock through the Strait of Hormuz, a vital shipping route.
Powell Reaffirms Caution on Rates
Markets now turn to Day 2 of Powell’s congressional testimony, this time before the Senate. On Tuesday, Powell emphasized the Fed’s patient stance, saying the central bank is not yet ready to adjust interest rates, citing elevated but stabilizing inflation and a solid labor market.
- May core PCE: +2.6% YoY
- Unemployment: Holding at 4.2%
Powell noted that tariffs introduced by the Trump administration pose a significant inflationary risk, urging caution in monetary policy adjustments.
FedEx Falls on Weak Outlook
FedEx (NYSE:FDX) shares slid in after-hours trading after the company issued a Q1 profit forecast below analysts’ expectations. The firm expects adjusted EPS of $3.40 to $4.00, below the consensus of $4.06, citing “volatile” global demand.
CEO Raj Subramaniam said on an earnings webcast that uncertainty stemming from trade policy—particularly the removal of duty-free treatment for low-cost shipments from retailers like Shein and Temu—was affecting business. FedEx also withheld full-year guidance, citing the “murky” global economic backdrop.
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