Futures tied to major U.S. equity indexes moved mostly higher in early trading, reflecting a tentative stabilization in markets after a week clouded by military action and energy market disruptions in the Middle East. By 04:58 ET (08:58 GMT), the Dow futures contract was up 48 points, or 0.1%, S&P 500 futures had gained 3 points, or 0.1%, and Nasdaq 100 futures were down 14 points, or 0.1%.
Equity benchmarks had fallen in the previous session as a sharp run-up in energy prices and related warnings from the Federal Reserve about the potential for sustained inflationary pressure weighed on sentiment. The market swing followed exchanges of strikes between Israel and Iran that hit energy-related targets across the region.
Conflict and market reaction
Traders and policymakers reacted to an escalation that began with an Israeli strike on South Pars, the Iranian portion of the world’s largest gas field, and continued as Tehran mounted retaliatory attacks on energy infrastructure sites across the Middle East, including a significant natural gas production center in Qatar. Those actions pushed benchmark crude and natural gas prices sharply higher before some of those gains reversed.
At the height of the move, Brent crude climbed to about $119 a barrel and Europe’s main natural gas gauge also spiked. Stocks later recovered from intraday lows and oil retreated from peak levels after U.S. and Israeli officials sought to reassure markets that additional strikes on South Pars would not follow. The White House also outlined plans to ease pressure in energy markets, including indications it may consider lifting certain sanctions on Iranian oil.
Policy caution rippled through central banks this week. The Federal Reserve, the European Central Bank, the Bank of England, the Swiss National Bank and the Bank of Japan all opted to hold interest rates steady, saying they needed more time to assess how the Middle East conflict might affect inflation and the global economy.
Washington tries to calm nerves
In public remarks aimed at lowering market anxiety, President Donald Trump pledged to take necessary steps to help cool the crisis and told Americans that "it will be over with soon." He also said he had no plans to deploy ground troops, though when asked about the possible use of land combat units he added: "If I did, I wouldn't tell you."
The Pentagon has requested $200 billion in war funding from the White House, underscoring the high fiscal cost associated with the campaign and the political divisions it has prompted domestically.
Energy routes, shipping and persistent supply concerns
Market participants cautioned that only a full reopening of the Strait of Hormuz - a critical shipping chokepoint south of Iran - would fully ease fears of a prolonged oil supply shortfall. The strait has been effectively closed as bombardments have been exchanged across the Middle East, and Iran has threatened to target vessels transiting the waterway that are carrying cargo it deems to benefit the U.S. or its allies.
Container carriers, worried about crew safety and confronted with difficulties securing insurance for voyages, have been reluctant to send ships through the narrow passage. That has left barrels and other supplies stranded, creating production backlogs and pushing crude values higher. Recent U.S. strikes have hit locations housing Iranian cruise missiles along the coast of the Strait of Hormuz, but observers cited in market commentary said that a land-based intervention in the area - or an outright cessation of hostilities - may be the only reliable ways to restore normal traffic.
Economists noted that even if the strait reopens to shipping, damage to oil infrastructure in other parts of the Middle East could have more persistent effects on global supply and economic activity.
On the trading screen, Brent was last quoted up 0.3% at $109.06 a barrel. For context, the contract had been exchanging hands at roughly $70 a barrel before the outbreak of the conflict.
Precious metals and currency moves
Gold staged a rebound after steep weekly losses tied to shifting expectations about inflation and central bank policy. The metal had plunged on Thursday after several major central banks warned about the inflationary consequences of the Iran war, a message that increased the likelihood of fewer interest rate cuts in the near term - a stance that generally weighs on precious metal prices.
Gold received some support from a pullback in the dollar, which was on track for its first weekly loss in three. The greenback underperformed other major developed-world currencies after central banks signaled they might pursue interest rate hikes in response to rising energy costs.
Corporate impact - FedEx outlook and fuel supplies
In corporate news tied to logistics and trade flows, FedEx raised its full-year profit outlook after reporting fiscal third-quarter profit and revenue that exceeded expectations, a performance driven by strong demand during the peak holiday period. Management said the updated forecast does not assume additional disruptions stemming from geopolitical turmoil, but warned that higher air freight costs and flight rerouting related to the Iran war could weigh on returns in the current quarter.
Company executives said that while FedEx might need to raise customer fees to offset conflict-driven fuel price rises, doing so could prompt customers to cut back on shipping spending. Speaking to Reuters, Chief Financial Officer John Dietrich said FedEx had not seen jet fuel supplies impacted by the fighting. Shares of FedEx jumped more than 9% in premarket U.S. trading.
What to watch next
Markets will remain focused on developments in the Middle East, official communications from Washington and allied capitals about steps to stabilize energy markets, and further guidance from central banks as they weigh whether to change policy settings in light of new inflationary risks. Investors are monitoring whether practical measures such as the possible easing of Iranian oil sanctions or the reopening of crucial shipping lanes will materialize and relieve supply pressures.
Given ongoing uncertainty, traders continue to position for volatility across energy, shipping and related industrial sectors, while also watching currency and precious metals markets for shifts tied to central bank commentary.
Summary: U.S. equity futures were mostly higher early Friday as U.S. and Israeli leaders moved to soothe market fears following strikes and counterstrikes that briefly sent oil and gas prices sharply higher. Brent crude eased from intraday peaks after diplomatic signals and potential White House steps to relieve energy market stress. Gold bounced amid broader currency moves, and FedEx raised its full-year outlook while saying it had not seen jet fuel shortages related to the conflict.