Overview
U.S. stock-index futures rose in early trading as market participants readied themselves for a pair of influential data releases: the monthly personal consumption expenditures price index and an advance reading of fourth-quarter economic growth. The gains in futures came against a backdrop of fresh unease that surfaced within the private credit market following a structural redemptions change at a major player, and as oil markets remained sensitive to escalating rhetoric between the United States and Iran.
Futures and recent market tone
By 03:09 ET (08:09 GMT), futures tied to the major U.S. averages were modestly higher. The Dow futures rose by 54 points, or roughly 0.1%, S&P 500 futures gained 14 points, or about 0.2%, and Nasdaq 100 futures climbed 57 points, or near 0.2%.
Those morning gains followed a down day for the cash market, when the main averages fell. Two sets of pressures contributed to that pullback: wider geopolitical frictions in the Middle East and a set of corporate earnings that some analysts characterized as underwhelming. Notable among company-specific moves, shares of a major big-box retailer slipped after management reported a sharp pickup in general merchandise inflation amid sweeping U.S. tariffs and issued a conservative outlook for the current year. Technology heavyweight Apple also declined, exerting additional downward pressure on the S&P 500.
Monetary policy commentary added another layer of market sensitivity. A Federal Reserve governor moderated a previously dovish stance on rates, remarks that followed the release of minutes from the Fed's January meeting. Those minutes showed participants warning of the possibility of a rate increase in coming months, which market strategists said heightened the perception that borrowing costs could remain higher for longer - a development that could create friction between the White House and the central bank.
Private credit: a jittery sector
Investor attention shifted sharply toward private credit after Blue Owl Capital, a major private lender, announced it would alter how quarterly redemptions are handled. Rather than allowing investors to request a fixed dollar amount back each quarter, Blue Owl said it will determine the amount to return at its discretion on a quarterly basis.
The change triggered declines in Blue Owl's shares and a pullback in names of other private credit managers, including Ares and Blackstone, reflecting concern that problems may be present somewhere within a large and often opaque market. Private credit has become a sizable source of lending to businesses in recent years, and the sector's structure can make assessments of liquidity and asset quality difficult for outside investors.
Questions have also been raised about the degree of private-credit exposure to software-related companies, a segment that has itself experienced pressure amid investor worries about disruptions tied to new artificial intelligence models.
Commenting on the developments via social media, a former chief executive of a large asset manager asked whether Blue Owl's redemption changes could be a "canary-in-the-coalmine" moment, likening the signal to the early stages of a prior financial crisis. His remarks emphasized two themes: the risk that an investing trend in advanced markets may have grown excessively, and the variance in approaches adopted by different firms within the sector, which creates potential adverse selection risks.
Oil steadies near highest levels since early August
Oil prices held steady and were positioned to record their first weekly gain in three weeks, supported by concerns that rising U.S.-Iran tensions could disrupt Middle Eastern supplies. Brent futures were trading around $71.66 per barrel, while U.S. West Texas Intermediate futures were near $66.35 per barrel.
Both contracts hovered close to their highest levels since early August and were set to rise more than 6% for the week. Market participants focused on comments from the U.S. president, who warned that "really bad things" could happen if Iran did not reach an agreement about its nuclear program within a 10-15 day window - language that increased the perceived prospect of military action.
Any escalation involving Iran, a major OPEC producer, could jeopardize shipments through the Strait of Hormuz. The passage is a critical chokepoint that accounts for roughly one-fifth of the world's oil flows, and disruptions there would quickly translate into tighter physical market conditions and higher price risk.
Key economic releases: PCE and GDP
Investors were particularly focused on the monthly personal consumption expenditures (PCE) price index for December, a measure the Federal Reserve watches closely. The core PCE index is forecast to register a 0.3% month-on-month rise for December, up from 0.2% in November, and to show a 3.0% increase year-on-year compared with 2.8% previously, according to consensus expectations.
Those readings follow a separate government report showing that the headline consumer price index rose at a cooler-than-expected pace in January. That softer CPI result had encouraged market participants to push forward the anticipated timing of the Fed's next rate reduction to as early as June. Offsetting that, a surprisingly strong employment report earlier in the week prompted some traders to push back against the idea of near-term easing, arguing that the central bank might defer further cuts until the second half of the year. The Fed has already reduced rates multiple times during 2025.
Also on the docket is an advance estimate of U.S. gross domestic product for the October-December period. Economists expect quarter-on-quarter growth of 2.8% in the final three months of the year, a slowdown from the 4.4% expansion recorded in the third quarter.
Domestic consumer spending continued to be a primary driver of activity in the July-September quarter, and a contracting trade deficit - influenced in part by broad U.S. tariff policies - also contributed to growth. While the headline GDP figure looks robust on aggregate, observers point to diverging outcomes across the population: higher-income households and corporations have been the main drivers of activity, while lower-income Americans contend with relatively elevated prices and a subdued hiring environment. Small businesses face their own pressures from rising import costs and a diminished supply of low-cost labor amid an ongoing immigration crackdown.
Market implications and sectoral sensitivities
Several sectors stand out as sensitive to the developments outlined above. The financial sector - particularly firms with exposure to private credit and alternative lending strategies - could see elevated volatility as investors reassess liquidity provisions and redemption frameworks. Technology and software companies are also in focus, given concerns about sector-specific pressures and potential spillovers from changes in funding conditions.
Consumer-facing sectors may respond differently depending on the inflation signal embedded in the PCE data. If core inflation proves stickier than expected, companies with limited pricing power could face margin pressure as input costs track through to operating results. Conversely, firms with strong distribution networks and capacity to pass through costs may be better positioned to protect margins.
Energy markets remain vulnerable to geopolitical shocks. Any material escalation in the Middle East could tighten physical flows and lift crude prices, a dynamic that matters directly to energy producers and indirectly to sectors sensitive to fuel costs.
Bottom line
Markets entered the day balancing macroeconomic data risk against idiosyncratic stress in a key corner of credit markets and heightened geopolitical tension. The December PCE and the advance GDP read will provide new data points that investors are likely to use to recalibrate expectations for policy rates and growth. At the same time, recent shifts in private credit liquidity terms and ongoing Middle East developments underscore that liquidity and supply-side shocks remain live risks for market participants.
For now, futures point to a cautiously positive open, but attention will be concentrated on the incoming data and any further news from private credit managers or political developments that might alter the trajectory for interest rates, risk assets, and commodity prices.