US stock futures showed signs of recovery after experiencing their largest daily drop this month. This stabilization was primarily due to Brent crude oil easing below $100 a barrel and a halt in the rise of bond yields. S&P 500 futures rose 0.3%, though the index remains on track for its first consecutive weekly loss since the initial stages of the conflict in the Middle East. Intel Corp. saw a rally after a strong revenue forecast, contrasting with many other chipmakers that declined in premarket trading. Megacap companies like Alphabet Inc. and Amazon.com Inc. also edged higher after Thursday’s sell-off.
Oil prices pulled back significantly, with Brent crude falling below $97 a barrel after reaching its highest level since May due to risk-driven rallies. Treasury yields retreated from their year-to-date peaks, and the dollar edged lower, while gold saw a modest increase. Risk appetite remained subdued throughout the week, marked by market jitters over the intensifying conflict in Iran and doubts about the effectiveness of massive investment strategies. Investors are now looking to the weekend, which could bring further escalation in the Middle East, and next week's earnings reports from AI hyperscalers.
Analysts noted surprise at the market's resilience despite the sharp increase in oil prices. Looking ahead, next week is considered crucial for market direction due to a heavy schedule of earnings reports, with growing concerns about capital expenditure within the AI sector. In corporate news, SAP SE reported better-than-expected results, while Volkswagen AG warned of challenges this year due to a deepening slump in China. The Stoxx Europe 600 rose 0.5%, and futures for the Dow Jones Industrial Average climbed 0.5%. The MSCI Asia Index and MSCI Emerging Markets Index both fell 2.1% and 2.6% respectively. Brent crude ultimately settled at $96.56 a barrel, a 3.7% drop, and spot gold rose 0.3% to $4,057.3 an ounce.
