Traders work on the New York Stock Exchange (NYSE) floor in New York City.
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S&P 500 futures inched down on Wednesday as traders braced for more losses to start October amid escalating tensions in the Middle East.
The broad index’s futures shed 0.1%, while Nasdaq-100 futures sat near flat. Futures tied to the Dow Jones Industrial Average lost 120 points, or 0.3%.
Nike slid more than 7% after the sneaker giant pulled its full-year guidance ahead of its CEO change. Tech also struggled for a second day, with intelligence darling Nvidia slipping close to 1% before the bell.
The major averages are coming off a losing session as rising tensions in the Middle East dented risk appetite and investor enthusiasm for the new trading period. The Dow fell more than 170 points, while the S&P 500 and Nasdaq Composite dropped 0.9% and 1.5%, respectively.
Those moves took place after as Iran fired ballistic missiles on Israel. Investors are readying for more uncertainty as Israel begins a ground operation into Lebanon and tensions escalated with Iran-backed militant group Hezbollah.
West Texas Intermediate crude oil prices rose 3% on Wednesday morning, building on Tuesday’s jump following the news out of the Middle East. The CBOE Volatility Index (VIX), also known as Wall Street’s fear gauge, remained above 19, underscoring the continued jitters.
“We came into the day with worries over how long the port strike would impact markets and potential economic growth, but those worries quickly moved to the Middle East,” said Ryan Detrick, chief market strategist at Carson Group. “The big worry now is should this conflict spiral into a larger scale war in the entire region, which of course could be a major October surprise.”
Ahead of Friday’s keynote September jobs report, Wall Street on Wednesday will gain insight into the state of private payrolls with ADP’s Employment Survey. Friday’s nonfarm payrolls report could play a major role in the market’s direction and the Federal Reserve’s next rate move as its cutting cycle begins.
Correction: Ryan Detrick is chief market strategist at Carson Group. An earlier version misidentified the firm.