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U.S. stock futures traded unevenly on Wednesday morning as investors weighed strength in major technology names against fresh inflation data that heightened concerns over interest rates and rising costs.

Nasdaq-linked futures outperformed ahead of the open, supported by gains in chipmakers, while sentiment across the broader market remained more cautious.

Nvidia helps lift semiconductor shares

Technology stocks appeared poised to lead early market gains, with Nvidia (NASDAQ:NVDA) climbing 1.6% in premarket trading.

The move followed confirmation that Nvidia CEO Jensen Huang would accompany U.S. President Donald Trump during his visit to China for talks with Chinese President Xi Jinping.

Reports indicated Huang was added to the delegation shortly before departure, boosting optimism across the semiconductor industry before trading began.

Producer inflation exceeds forecasts

Outside of technology, investor enthusiasm was more restrained after new U.S. inflation figures came in stronger than anticipated.

Data released by the United States Department of Labor showed producer prices for final demand rose 1.4% in April, following an upwardly revised 0.7% increase in March.

Economists had forecast a monthly rise of 0.5%.

The report also revealed that annual producer inflation accelerated to 6.0% from 4.3%, surpassing expectations for a 4.9% reading.

Wall Street recovered from sharp early declines on Tuesday

U.S. equities regained momentum during Tuesday’s session after suffering steep losses earlier in the day.

The Nasdaq, heavily weighted toward technology companies, recovered after falling as much as 2%, although it still ended down 185.92 points, or 0.7%, at 26,088.20.

The S&P 500 fell 11.88 points, or 0.2%, to 7,400.96, while the Dow Jones Industrial Average rose 56.09 points, or 0.1%, to finish at 49,760.56.

Oil prices remain elevated amid Iran uncertainty

Rising crude prices contributed to Tuesday’s early market weakness, with U.S. oil futures surging more than 4% and climbing back above the $100-per-barrel threshold.

Energy markets continued reacting to uncertainty surrounding negotiations between Washington and Tehran aimed at ending the conflict and reopening the Strait of Hormuz.

Trump said Monday that the U.S.-Iran ceasefire was on “life support,” describing the truce as “unbelievably weak.”

Inflation concerns continue to weigh on investors

Investor sentiment was also pressured by consumer inflation data released earlier in the week, which showed the sharpest annual increase in consumer prices since May 2023.

Consumer inflation accelerated to 3.8% in April from 3.3% in March, largely due to rising energy costs.

Even so, equities recovered some ground later in Tuesday’s trading session as investors remained encouraged by strong corporate earnings results.

“Given that inflation is heading in the wrong direction and the labor market is holding up, it’s very unlikely that the Fed will be able to lower interest rates any time soon and it’s possible that we may start pricing in rate hikes for next year,” said Chris Zaccarelli of Northlight Asset Management.

He added, “We don’t believe the market needs rate cuts to keep climbing, but earnings will need to keep doing a lot of the heavy lifting as multiple expansion isn’t in the cards right now.”

Tech and airline stocks lagged in prior session

Semiconductor and computer hardware shares posted some of the biggest declines during Tuesday’s session, putting pressure on the Nasdaq.

The NYSE Arca Computer Hardware Index dropped 3.6%, while the Philadelphia Semiconductor Index slid 3%.

Airline stocks also weakened notably, with the NYSE Arca Airline Index falling 2%.

Networking, software and steel shares also moved lower, while oil service companies benefited from higher crude prices, pushing the Philadelphia Oil Service Index up 2.2%.

Meanwhile, healthcare, biotechnology and pharmaceutical stocks outperformed and helped cushion broader market declines.

Shares in Eutelsat Communications (LSE:ETL) moved lower on Wednesday after the satellite operator posted a decline in third-quarter revenue, with ongoing weakness in its Video division outweighing continued expansion across its Connectivity activities.

Group revenue for the quarter ended March 31, 2026 came in at €293 million, compared with €299.8 million in the same period a year earlier, representing a reported decline of 2.3%. On a like-for-like basis, however, revenue increased by 3.1%.

Revenue generated by the company’s four core operating segments — Video, Government Services, Mobile Connectivity and Fixed Connectivity — declined 5.6% on a reported basis to €283.7 million, although it recorded like-for-like growth of 0.9%.

Video segment hit by Russian sanctions and satellite contract losses

Revenue from the Video business, which represented 45% of total group revenue, fell to €128.0 million from €151.7 million a year earlier. The decline was largely linked to sanctions affecting Russian television channels and the end of capacity agreements tied to the Express AT1 and AT2 satellites.

The company said sanctions affecting Russian channels had an annualised impact of around €16 million, while the termination of Express satellite contracts is expected to create an additional low single-digit million euro impact during fiscal 2025-26 beginning in March 2026.

Connectivity business continues to expand

Connectivity revenue rose to €155.7 million from €148.9 million and accounted for 55% of total group revenue during the quarter.

Within the division, Low Earth Orbit (LEO) revenue increased 65.0% on a like-for-like basis to €62.2 million from €42.3 million a year earlier. By contrast, Geostationary revenue declined 4.3% to €93.5 million from €106.7 million.

Government Services revenue climbed 11.8% on a like-for-like basis to €50.4 million, while Mobile Connectivity revenue advanced 27.0% to €45.0 million.

Fixed Connectivity revenue rose 10.6% on a like-for-like basis to €60.3 million. However, the company noted that revenue in the segment fell 12.9% compared with the previous quarter because of one-off upfront revenue recognition linked to a capacity contract recorded during the second quarter.

Other revenue and backlog remain supportive

Other revenue totaled €9.4 million, compared with negative €0.7 million in the prior-year period, supported by revenue recognition related to the IRIS2 programme as well as a positive hedging impact of €0.3 million.

For the first nine months of fiscal 2025-26, total revenue decreased 2.4% on a reported basis to €884.7 million, although it increased 1.1% at constant currency rates. Over the same period, LEO revenue rose 61.6% on a like-for-like basis to €172.7 million.

At March 31, 2026, Eutelsat’s contract backlog stood at €3.4 billion, equivalent to 2.8 times fiscal 2024-25 revenue, with Connectivity accounting for 58% of the total backlog.

Financing completed as company maintains guidance

Eutelsat said it completed a €1.50 billion senior notes offering on March 5, representing the final phase of an approximately €5 billion combined equity and debt financing programme.

The group expects net debt-to-EBITDA to stand at around 2.7 times by the end of fiscal 2025-26.

The company also reaffirmed its guidance for fiscal 2025-26, including expectations for operating vertical revenue to remain broadly in line with fiscal 2024-25 levels, LEO revenue growth of 50% year-on-year and an adjusted EBITDA margin slightly below the prior-year figure. Gross capital expenditure is forecast at approximately €900 million.

Eutelsat further reiterated its medium-term targets for fiscal 2028-29, including operating vertical revenue between €1.50 billion and €1.70 billion and an EBITDA margin of at least 65%, based on an assumed euro-to-dollar exchange rate of 1.12.

Oil prices moved lower on Wednesday, pulling back after three consecutive sessions of gains as markets weighed uncertainty surrounding the fragile situation in the Middle East and awaited high-level talks between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing.

Brent crude futures fell $1.47, or 1.4%, to $106.30 a barrel by 0630 GMT, while U.S. West Texas Intermediate crude declined $1.41, or 1.4%, to $100.77 per barrel.

Both benchmarks have traded near or above $100 a barrel since the United States and Israel launched military operations against Iran in late February and Tehran effectively closed the Strait of Hormuz.

Supply disruption fears continue to underpin prices

Despite Wednesday’s decline, concerns over energy supply disruptions continued to provide support to the oil market.

“Concerns over supply disruptions and uncertainty surrounding the Middle East are keeping oil prices well supported, even as traders struggle to establish a clear direction,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

“The market remains highly reactive to every update from the region, meaning sharp swings are likely to persist. Any further escalation or direct threat to supply flows could quickly revive strong upside momentum in both Brent and WTI,” added Sachdeva.

Oil had surged more than 3% on Tuesday after hopes for a lasting ceasefire agreement between the United States and Iran weakened further, reducing expectations that the Strait of Hormuz would reopen in the near future. Around 20% of global oil and liquefied natural gas shipments normally pass through the strategic route.

Trump says China’s help on Iran may not be needed

Trump said Tuesday that he did not expect to require China’s assistance to end the conflict with Iran, even as the likelihood of a long-term peace agreement appeared to diminish and Tehran tightened its control over the Strait of Hormuz.

China remains the largest purchaser of Iranian crude despite sanctions imposed by Washington. Trump is scheduled to meet Xi Jinping in Beijing on Thursday and Friday.

Analysts at Eurasia Group said in a research note: “The length of the disruption and the scale of the supply loss – already more than 1 billion barrels – means oil prices are likely to remain above $80 per barrel for the rest of the year.”

Rising fuel costs increase pressure on the U.S. economy

The conflict involving Iran is increasingly affecting the U.S. economy as elevated crude prices push fuel costs higher for households and businesses. Economists also expect broader knock-on effects to emerge in the coming months.

Inflation figures released in April showed U.S. consumer prices rose sharply for a second straight month, resulting in the strongest annual inflation increase in nearly three years. The data reinforced expectations that the Federal Reserve could keep interest rates elevated for longer.

“The marked increase in inflation across advanced economies has yet to cause real spending to contract, but the widespread decline in consumer sentiment and hiring intentions points to worse to come,” analysts at Capital Economics wrote in a note to clients.

Higher interest rates typically increase borrowing costs, which can slow economic growth and weaken oil demand.

U.S. oil inventories extend decline

Meanwhile, U.S. crude stockpiles declined for a fourth consecutive week last week, while distillate inventories also moved lower, according to market sources citing figures from the American Petroleum Institute.

Gold prices were little changed in Asian trade on Wednesday, with investors remaining cautious as hopes for a near-term peace agreement between the United States and Iran continued to fade ahead of scheduled talks between Donald Trump and Chinese President Xi Jinping.

Spot gold slipped 0.1% to $4,712.27 an ounce by 02:44 ET (06:44 GMT), while U.S. gold futures added 0.6% to $4,721.22 an ounce.

The precious metal had fallen 0.4% in the previous session as stronger U.S. inflation figures and a firmer dollar pressured bullion prices.

Markets monitor Trump-Xi meeting amid ongoing Middle East uncertainty

Investor confidence remained subdued after Trump said earlier this week that negotiations with Iran were on “life support” after Tehran rejected a U.S.-backed proposal intended to end hostilities and reopen the Strait of Hormuz.

The remarks weakened expectations for a near-term ceasefire and reinforced concerns over rising geopolitical risks.

The prolonged conflict has continued to disrupt shipping through the Strait of Hormuz, a crucial energy corridor through which roughly 20% of global oil supplies pass, heightening fears that elevated energy costs could keep inflation under pressure and complicate central bank policy decisions.

Investors are also closely watching the Trump-Xi summit scheduled for May 14-15 in Beijing. Discussions are expected to include trade tensions, Taiwan, the Iran conflict and broader supply-chain concerns.

Inflation and rising yields weigh on bullion

Gold has struggled to attract fresh buying this week after stronger-than-forecast U.S. inflation data pushed Treasury yields higher and supported the dollar, reducing demand for non-yielding assets such as bullion.

The U.S. Dollar Index rose 0.1% on Wednesday following a 0.4% gain in the prior session.

Data released Tuesday showed that U.S. consumer prices increased by 0.6% in April, while annual inflation accelerated to 3.8%, marking the highest reading since mid-2023. The rise was driven largely by surging energy prices linked to tensions in the Middle East. Core inflation also exceeded market expectations.

Markets have now largely abandoned expectations for Federal Reserve rate cuts this year, while pricing for potential rate increases edged slightly higher.

Higher interest rates typically pressure gold because they raise the opportunity cost of holding assets that do not generate income.

Traders are now awaiting U.S. producer price data due later Wednesday for further insight into inflation trends and the likely path of Federal Reserve policy. Expectations for rate reductions this year have continued to decline.

Silver mixed while copper prices rise

Elsewhere in metals markets, spot silver gained 0.1% to $86.68 an ounce, while platinum fell 0.5% to $2,121.80 an ounce.

Benchmark copper futures on the London Metal Exchange rose 0.8% to $14,142.33 per ton, while U.S. copper futures traded broadly unchanged at $6.64 per pound.

European equity markets moved higher on Wednesday as investors monitored ongoing tensions between the United States and Iran while U.S. President Donald Trump traveled to China ahead of a closely watched summit.

By 07:13 GMT, the pan-European STOXX Europe 600 had climbed 0.7%, while Germany’s DAX rose 0.6%. France’s CAC 40 gained 0.2% and the UK’s FTSE 100 advanced 0.8%.

Trump is expected to hold direct talks with Chinese President Xi Jinping later this week, with discussions likely to cover trade relations, Taiwan and broader geopolitical issues.

However, market attention remains heavily focused on the continuing standoff between Washington and Tehran. Analysts have suggested that China, as one of the largest buyers of Iranian crude oil, could potentially play a role in supporting a longer-term peace agreement, although expectations for a major diplomatic breakthrough from the summit have eased in recent days.

Efforts to secure an agreement between the U.S. and Iran appear to have reached a deadlock. Earlier this week, Trump rejected Iran’s response to a U.S. peace proposal, calling it “unacceptable” and a “piece of garbage.” Speculation has also continued over whether the White House may resume military strikes against Iran.

For its part, Tehran has given little indication that it intends to make further concessions to Washington.

The prolonged impasse has left the Strait of Hormuz — a strategically important shipping route off Iran’s southern coast through which around one-fifth of global oil supplies pass — effectively closed for several weeks.

As a result, oil prices remain significantly above pre-conflict levels, adding to inflationary pressures worldwide. The trend was reinforced by data released on Tuesday showing that U.S. consumer prices continued to rise rapidly in April following another notable increase the previous month.