U.S. equity futures traded in positive territory on Friday as markets weighed escalating geopolitical risks against encouraging corporate earnings, while investors also assessed new U.S. trade tariffs and looked ahead to key economic data.
Markets rebound despite ongoing geopolitical uncertainty
As of 03:34 ET (07:34 GMT), Dow Jones futures had risen 0.4%, S&P 500 futures added 0.2%, and Nasdaq 100 futures advanced 0.1%.
The gains followed Thursday’s market decline, which was triggered by renewed concerns over the conflict involving the United States, Iran and Iran-backed Houthi forces. Reports of attacks on Saudi oil tankers in the Red Sea, together with continued military exchanges between Washington and Tehran, briefly pushed Brent crude above $100 per barrel.
The surge in oil prices renewed fears that inflationary pressures could persist, reducing the likelihood of near-term interest rate cuts and lifting U.S. Treasury yields.
“The continued rise in energy prices is starting to put pressure on financial markets more broadly, beyond just the bond market. While central banks continue to take a measured approach to the renewed surge in energy prices, there is still plenty of scope for the turbulence in markets to ratchet higher if the U.S.-Iran conflict continues to escalate,” said Jonas Goltermann, Chief Markets Economist at Capital Economics.
Fighting continues as ceasefire proposal is rejected
The U.S. military announced that it had carried out a 13th consecutive night of strikes targeting Iranian military facilities, including drone storage locations and coastal surveillance infrastructure.
According to reports from The New York Times, Iran rejected another ceasefire proposal delivered through Iraqi officials on behalf of President Donald Trump, with Iranian representatives maintaining that “America’s outlook” remained unacceptable.
Meanwhile, Yemen’s Houthi movement claimed responsibility for disrupting shipping through the Bab el-Mandeb Strait after attacking Saudi oil tankers. Saudi Arabia confirmed that one vessel had been struck.
Although Brent crude later retreated to around $98.90 per barrel, prices remain well above levels seen following the temporary ceasefire reached in June.
New U.S. tariffs add another layer of uncertainty
Trade policy also drew attention after the White House introduced import tariffs of between 10% and 12.5% on products from 60 countries.
The administration said the measures are designed to address insufficient enforcement of restrictions on goods produced with forced labour. Canada and the European Union are among the countries affected, with officials arguing that existing regulations have not been adequately enforced.
Media reports indicate that further tariff measures targeting manufacturing imports could be announced in the coming weeks.
Intel delivers upbeat quarterly performance
Intel (NASDAQ:INTC) gained in after-hours trading after reporting second-quarter results that exceeded Wall Street expectations.
Revenue climbed 25% year-on-year, while guidance for the current quarter of $15.8 billion to $16.8 billion also came in above analyst forecasts.
Chief Executive Lip-Bu Tan said artificial intelligence is “driving unprecedented demand for compute” and believes the company is positioned for “sustainable growth.”
Intel continues to benefit from expanding AI investment and its strategic role as one of the few large-scale semiconductor manufacturers operating in the United States.
PMI data in focus
Investors are also awaiting S&P Global’s preliminary July PMI figures for the U.S.
June’s composite PMI stood at 52.2, reflecting continued expansion in economic activity, supported by robust services demand and a fourth consecutive month of manufacturing growth as businesses strengthened inventories to manage supply risks.
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