U.S. equity futures traded in positive territory on Thursday, indicating that stocks may attempt to recover after suffering steep losses in the previous session.
The rebound comes as investors look for buying opportunities following Wednesday’s sell-off, which pushed the Nasdaq and S&P 500 to their weakest closing levels in roughly a month.
Intel Upgrade Lifts Technology Sector
Semiconductor shares are expected to be among the market’s strongest performers at the open.
Intel (NASDAQ:INTC) climbed 4.6% in premarket trading after Bank of America upgraded the stock to Buy from Underperform, boosting confidence across the broader chip sector.
The move provided a welcome catalyst for technology stocks following the previous day’s widespread weakness.
Oil Rally Caps Early Gains
Even so, futures surrendered part of their advance after crude oil prices surged following fresh comments from President Donald Trump regarding Iran.
Posting on Truth Social, Trump said the United States would strike Iran “very hard tonight” and suggested Washington intends to gain control of the country’s oil and gas markets “at some point in the not too distant future.”
The comments reignited concerns about global energy supplies and added another layer of uncertainty to financial markets.
Inflation Worries Remain in Focus
Market sentiment was also affected by fresh inflation data.
The Labor Department reported that producer prices rose more strongly than expected in May, reinforcing concerns that inflation remains stubborn despite previous signs of moderation.
Persistent inflation could complicate the outlook for interest rates and limit the scope for a broader market recovery.
Wednesday’s Sell-Off Hits Major Indexes
Stocks spent much of Wednesday under pressure as geopolitical concerns and inflation fears combined to weigh on investor confidence.
By the closing bell, all three major indexes had suffered significant losses.
The Dow Jones Industrial Average fell 953.33 points, or 1.9%, to 49,918.78. The Nasdaq Composite dropped 509.32 points, or 2.0%, to 25,169.50, while the S&P 500 lost 119.66 points, or 1.6%, to end at 7,266.99.
Trump Intensifies Pressure on Iran
Investor anxiety increased after President Donald Trump escalated his rhetoric toward Iran following recent military confrontations.
“We hit them hard yesterday, and we’re going to hit them hard again today,” Trump told reporters at the White House. “We’re going to be attacking them and attacking them very hard.”
The remarks followed confirmation from U.S. Central Command that American forces had conducted “self-defense strikes” against Iranian targets after a U.S. military helicopter was shot down.
CENTCOM stated that precision strikes targeted Iranian air-defense systems, ground-control facilities and surveillance radar sites near the Strait of Hormuz.
Iran reportedly responded by targeting U.S. military installations in Kuwait, Bahrain and Jordan, while warning that it would answer any future threats or attacks.
Trump later wrote on Truth Social that Iran had “taken too long to negotiate a deal” and would now have to “pay the price!”
Energy Markets React to Escalating Conflict
The worsening conflict helped drive oil prices higher as traders assessed the risk of disruptions to Middle Eastern energy exports.
Market participants largely brushed aside Trump’s claims that the United States had quietly assisted in transporting more than 100 million barrels of oil through the Strait of Hormuz.
The resulting increase in crude prices added to inflation concerns already weighing on investor sentiment.
Consumer Inflation Meets Expectations
Separately, inflation data released by the Labor Department came in largely as expected.
Consumer prices increased 0.5% in May following a 0.6% rise in April, matching economists’ forecasts.
On an annual basis, inflation accelerated to 4.2% from 3.8%, also meeting expectations.
Core inflation, which excludes food and energy, rose 0.2% during the month, below forecasts of 0.3%.
The annual core inflation rate edged up to 2.9% from 2.8%, in line with market estimates.
Airlines and Gold Stocks Lead Market Declines
Airline stocks were among the hardest-hit sectors as higher oil prices raised concerns over fuel costs.
The NYSE Arca Airline Index plunged 5.4%, while gold-related shares also suffered, with the NYSE Arca Gold Bugs Index falling 5% as bullion prices weakened.
Technology hardware, semiconductor and housing stocks also posted notable losses.
Energy stocks stood out as one of the few areas of strength, benefiting from the sharp rise in crude oil prices.
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