S&P 500 Stock Futures Fall Hard — Trump Says War Could Go “Far Longer”

TLDR

• US stock futures dropped sharply Tuesday after Israel and US jets launched new strikes on Iran and Lebanon.
• S&P 500 futures fell 1.5%, Dow futures dropped 1.4%, and Nasdaq 100 futures tumbled nearly 2%.
• Oil surged over 6%, with Brent crude hitting $82.64 a barrel as tankers avoided the Strait of Hormuz.
• President Trump refused to rule out US ground troops, saying the US could sustain the conflict “far longer” than four to five weeks.
• Treasury yields rose as investors feared an oil-driven inflation spike, while Bitcoin slid 2.2% and gold initially dipped before climbing.

US stock futures dropped sharply on Tuesday morning as new strikes on Iran and Lebanon rattled markets and pushed oil prices higher.

Futures on the Dow Jones Industrial Average fell 692 points, or around 1.4%. S&P 500 futures slid 1.5%, and contracts tied to the Nasdaq 100 dropped roughly 2%.

The moves came after Israeli and US jets struck targets in Iran and Lebanon overnight. Iran responded by hitting the US Embassy in Saudi Arabia and other targets across Gulf states, with at least nine countries reporting strikes.

It was a sharp reversal from Monday’s session. Stocks had recovered from steep intraday losses to close mostly higher, with the S&P 500 posting its biggest intraday comeback since November.

Tuesday’s premarket selling was broader and harder to shake off.

Oil Spikes as Strait of Hormuz Concerns Mount

Crude prices jumped over 6% as tankers began avoiding the Strait of Hormuz, a critical shipping corridor for global oil supply. Brent crude climbed to $82.64 a barrel, up 6.3%, while West Texas Intermediate rose 6.5% to $75.87.

The oil spike stoked inflation fears and sent Treasury yields higher. The 10-year yield rose 5 basis points to 4.09%, after jumping 9 points the session before.

Gold futures climbed 0.4% to $5,331 an ounce despite an earlier dip, as investors moved into haven assets. The dollar added 0.6% against a basket of currencies.

Bitcoin slid 2.2% to $67,616, reflecting the broader risk-off mood.

President Trump added fuel to the fire Monday night, posting on Truth Social that the US had “a virtually unlimited supply” of weapons. He refused to rule out deploying ground troops, saying “whatever it takes,” and suggested the conflict could run “far longer” than the initial four-to-five-week estimate.

Corporate Earnings Still in Focus

Despite the geopolitical noise, earnings season continued. Target rose in premarket after posting holiday and full-year sales that met Wall Street estimates. Results from Ross Stores, AutoZone, and Best Buy were also due Tuesday.

As of Tuesday morning, Dow futures were down 744 points at 48,201, S&P 500 futures sat at 6,780, and Nasdaq 100 futures were at 24,521.

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