June S&P 500 E-Mini futures (ESM26) are down -0.91%, and June Nasdaq 100 E-Mini futures (NQM26) are down -1.03% this morning as mounting uncertainty over Iran’s willingness to engage in negotiations to end the Middle East conflict pushed oil prices higher.

President Trump said on Wednesday that talks with Iran are taking place and that the Iranian regime wants “to make a deal so badly” but is afraid to admit it. The Wall Street Journal reported that President Trump continues to hope to bring the Iran conflict to an end in the coming weeks. However, Tehran has so far rejected direct talks with Washington, at least publicly, with about 48 hours remaining before a U.S. pause in strikes on Iranian energy infrastructure expires to allow for negotiations.

Also adding to the negative sentiment on Thursday was an Axios report stating that the Pentagon is developing military options for a “final blow” in Iran that could involve the use of ground forces and a large-scale bombing campaign if diplomatic efforts fail to make progress and, in particular, if the Strait of Hormuz remains closed.

The price of WTI crude climbed nearly +5% on Thursday as expectations of a near-term peace deal between Iran and the U.S. diminished. The move showed up in the bond market, with the 10-year T-note yield rising five basis points to 4.39%. 

In yesterday’s trading session, Wall Street’s three main equity benchmarks closed higher. Chip stocks rallied, led by a more than +7% gain in Intel (INTC) and Advanced Micro Devices (AMD) after Nikkei Asia reported that both companies had notified clients of plans to raise prices across all CPU series. Also, shares of space and satellite companies jumped after The Information reported that SpaceX plans to file a prospectus for an initial public offering as early as this week, with Globalstar (GSAT) and Rocket Lab (RKLB) surging more than +10%. In addition, Arm Holdings (ARM) popped more than +16% and was the top percentage gainer on the Nasdaq 100 after the company said it expects its new chip business to generate about $15 billion annually within five years. On the bearish side, shares of memory and data storage companies slid, with Sandisk (SNDK) and Micron Technology (MU) falling over -3%.

“There’s really no way to know at this point what the facts are regarding the state of negotiations, so expect more whipsaw action as things continue to progress. While Iran still holds some cards, the chips are stacked heavily against them,” said Bespoke Investment Group strategists.

Economic data released on Wednesday showed that the U.S. import price index climbed +1.3% m/m in February, stronger than expectations of +0.6% m/m, and the export price index jumped +1.5% m/m, stronger than expectations of +0.5% m/m.

Fed Governor Stephen Miran said on Wednesday he raised his projection for where interest rates should end the year by half a percentage point in response to disappointing inflation data since policymakers last issued forecasts in December. “I boosted my policy rate by half a percent, not due to oil and Iran, but due to the inflation data that we received,” Miran said.

Meanwhile, U.S. rate futures have priced in a 93.8% probability of no rate change and a 6.2% chance of a 25 basis point rate hike at the conclusion of the Fed’s April meeting.

Today, investors will focus on U.S. Initial Jobless Claims data, set to be released in a couple of hours. Economists project this figure to be 211K, compared to last week’s number of 205K.

Market participants will also hear perspectives from Fed Vice Chair Philip Jefferson, along with Fed Governors Lisa Cook, Michael Barr, and Stephen Miran, throughout the day.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.39%, up +1.31%.

The Euro Stoxx 50 Index is down -1.10% this morning, snapping a three-day streak of gains as investors weighed the likelihood of an imminent rate hike by the European Central Bank, while fading hopes for a swift end to the Middle East conflict added to the downbeat mood. Industrial, bank, and travel stocks tumbled on Thursday. A survey released on Thursday showed that German consumer sentiment is poised to weaken heading into April, as households brace for energy prices pushed higher by the Middle East conflict to lift inflation and restrain Germany’s nascent economic recovery. Separately, data showed that growth in Eurozone bank lending remained steady in February, suggesting that economic activity in the bloc was likely expanding at a moderate pace before the Middle East conflict erupted. Meanwhile, Eurozone government bond yields climbed on Thursday as a rise in oil prices reignited inflation fears. European Central Bank Governing Council member Joachim Nagel told Reuters in an interview published Thursday that the central bank could raise interest rates at its next meeting in April if the inflation outlook continues to worsen due to the Middle East conflict, with sufficient information expected in the coming weeks. In corporate news, H&M (HMB.S.DX) slumped over -5% after the Swedish fashion retailer reported weaker-than-expected quarterly sales.

Germany’s GfK Consumer Climate Index, France’s Consumer Confidence, and Spain’s GDP data were released today.

The German April GfK Consumer Climate Index came in at -28.0, weaker than expectations of -27.3.

The French March Consumer Confidence stood at 89, in line with expectations.

The Spanish GDP has been reported at +0.8% q/q and +2.7% y/y in the fourth quarter, compared to expectations of +0.8% q/q and +2.6% y/y.

Asian stock markets today closed in the red. China’s Shanghai Composite Index (SHCOMP) closed down -1.09%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -0.27%.

China’s Shanghai Composite Index closed lower today as doubts over a near-term end to the Middle East conflict sapped risk sentiment. Cloud computing and insurance stocks underperformed on Thursday. U.S. President Donald Trump said Iran was keen to reach a deal, while Iranian Foreign Minister Abbas Araqchi stated there had been no direct dialogue or negotiations with the U.S., although messages had been conveyed through intermediaries. Meantime, President Trump and Chinese leader Xi Jinping will hold their highly anticipated summit in Beijing on May 14-15, after a delay that injected uncertainty into relations between the world’s two largest economies. In other news, Reuters reported that China is weighing the relaxation of shareholding restrictions for certain major investors, in a move designed to expand capital-raising options for commercial banks grappling with an economic slowdown. In corporate news, China Life Insurance fell over -4% after the insurer reported mixed full-year results. Investor focus now turns to China’s industrial profit data for the January-February period, scheduled for release on Friday. “Markets will watch for any improvement from the sluggish 0.6% year-on-year growth rate in 2025,” ING economists said.

Japan’s Nikkei 225 Stock Index reversed earlier gains and closed lower today, snapping a two-day winning streak as persistent Middle East tensions and conflicting signals from the U.S. and Iran over their ceasefire talks led investors to sell stocks. The U.S. maintained that negotiations were ongoing, but Iran rejected outreach from President Trump. Insurance and software stocks led the declines on Thursday. Data released on Thursday showed that a key measure of Japan’s service-sector inflation rose 2.7% in February from a year earlier, reinforcing the Bank of Japan’s view that a tight labor market is prompting firms to pass higher costs on to consumers. Separately, the BOJ said the core consumer price index climbed 2.2% in February, excluding special factors, releasing the new gauge for the first time, which analysts say is an effort to demonstrate that underlying inflation remains on track for further rate hikes. Meanwhile, Japan’s two-year government bond yield rose to its highest level since 1996 on Thursday, while five-year yields reached a record high, as expectations mount for a near-term BOJ rate hike. The moves come as investors price in an oil-driven inflation shock following the start of the Middle East conflict. “The BOJ is aware that inflation accelerated in the wake of the Russia-Ukraine war. Therefore, the market is increasingly bracing for an early interest rate hike, and that could happen in April,” said Katsutoshi Inadome, senior strategist at Sumitomo Mitsui Trust Asset Management. In other news, foreign investors sold about 2.51 trillion yen ($15.74 billion) worth of Japanese stocks in the week through March 21st, marking their largest weekly net outflow in 18 months, according to Ministry of Finance data. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +18.11% to 44.48.

The Japanese February Corporate Services Price Index rose +2.7% y/y, stronger than expectations of +2.6% y/y.

Pre-Market U.S. Stock Movers

The Magnificent Seven stocks fell in pre-market trading, with Tesla (TSLA), Meta Platforms (META), Nvidia (NVDA), and Alphabet (GOOGL) sliding over -1%.

Chip stocks slipped in pre-market trading, with Advanced Micro Devices (AMD) and Marvell Technology (MRVL) dropping more than -1%.

Memory and storage stocks dropped in pre-market trading, extending yesterday’s losses after Google touted a technique that could lower AI memory needs. Sandisk (SNDK) is down over -3%, Micron Technology (MU) is down more than -2%, and Western Digital (WDC) is down over -1%.

Mining stocks slid in pre-market trading as metal prices sank, with Newmont (NEM) slumping over -3% and Freeport-McMoRan (FCX) falling more than -2%.

Navan (NAVN) soared over +24% in pre-market trading after the business travel and expense platform posted upbeat FQ4 results and issued above-consensus FY27 revenue guidance.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Thursday - March 26th

Commercial Metals Company (CMC), Argan (AGX), REX American Resources (REX), Bitgo Holdings (BTGO), Lumexa Imaging Holdings (LMRI), Oxford Industries (OXM), Shoe Carnival (SCVL), CapsoVision (CV), Designer Brands (DBI), Token Cat (TC), The Lovesac Company (LOVE), Buda Juice (BUDA).

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• Stock Index Futures Rally as Oil Prices Tumble on U.S.-Iran Talks