US stock markets are poised to open significantly lower on Tuesday due to escalating tensions in the Middle East, causing investor unease and driving up oil prices. Futures tied to the S&P 500 and the Dow Jones Industrial Average are down nearly 2% in pre-market trading, while Nasdaq Composite futures have fallen around 2.5%, indicating a weak start for Wall Street.
The heightened tensions involving the United States, Israel, and Iran have led to concerns about potential disruptions in global oil supplies, resulting in elevated crude prices and fears of increased consumer inflation. Technology stocks, which had seen recent gains, are facing pressure, with Nvidia dropping 3.1% and Microsoft declining 1.8% in pre-market trading.
Memory chip manufacturers are also experiencing significant losses, with SanDisk down by 8.4% and Western Digital losing 5.6% following a strong rally in February. However, energy and defense stocks are among the few sectors showing gains, with Occidental Petroleum rising by 3.7% and Cheniere Energy climbing by 9.8%.
Market volatility has been fueled by reports of heightened attacks by Iran in the region, targeting energy infrastructure in Gulf countries and oil tankers. Tehran’s reported drone strikes near the US embassy in Riyadh and threats to close the Strait of Hormuz have added to the uncertainty. The strategic waterway, responsible for a significant portion of the world’s oil supply and liquefied natural gas shipments, has seen crude prices surge for the fourth consecutive day.
