After a recent run higher, U.S. stock futures slipped this morning. Dow futures were down roughly 0.6 to 0.7% before the open, with S&P 500 and Nasdaq futures also in the red. The shift in mood reflects renewed tension around the U.S.-Iran conflict: Iran's seizure of ships in the Strait of Hormuz, its demand that the U.S. lift the naval blockade on Iranian ports, and the White House's effort to preserve the cease-fire with no real settlement in sight have all taken their toll on investors.

That helps explain why Brent has moved back above $100 a barrel, with WTI also climbing. Investors are reacting to the growing possibility that even if shooting pauses, the economic damage will linger.

Still, to put things into perspective, Wall Street ended yesterday sharply higher: the S&P 500 rose 0.9% and the Nasdaq 1.5%, with both setting fresh records. The broad U.S. index is up 4.3% in 2026, while its European counterpart has gained 3.7%.

That resilience makes the earnings backdrop all the more striking. On paper, this has been a solid season. About 85% of S&P 500 companies reporting so far have beaten expectations. That would normally be enough to keep the market cheerful. But investors are rightly asking a basic question: How useful are earnings that capture only the first month of a much larger disruption? If the war's real economic effects are still moving through supply chains, fuel markets, factory orders, airline schedules, and consumer budgets, then backward-looking results may be less reassuring than they seem.

That tension is also showing up in corporate news. Tesla beat expectations, but the stock still fell as investors focused on its ballooning spending plans. Elon Musk is pushing deeper into artificial intelligence, robotics, and chips, and the bill is now enormous. Earlier this year, markets worried that corporate America might be spending too much on AI with too little clarity on the eventual payoff. That concern never really disappeared, but it now seems to be back in focus. IBM fell after slower revenue growth, especially in software. Microsoft and Adobe slipped as well. ServiceNow dropped sharply after warning that an acquisition would pressure margins.

Elsewhere, the picture was equally mixed. Lockheed Martin fell, and Honeywell also slid after results. Southwest warned that rising jet-fuel costs are putting pressure on profit guidance.

There were winners too, which suggests investors are becoming more selective rather than simply more pessimistic. Texas Instruments jumped after issuing a stronger-than-expected outlook. Dow rose after a smaller loss than feared. American Express posted higher earnings and revenue.

Against that backdrop, weekly jobless claims and fresh manufacturing numbers were in focus because investors are trying to measure how much damage higher energy prices may already be doing.

Today's economic highlights:

Today's schedule includes: the Services and Manufacturing PMIs in Japan; In France, Business Confidence and the Manufacturing, Services, and Composite PMIs; In Germany, the Manufacturing, Services, and Composite PMIs; In the Euro Area, the Manufacturing, Services, and Composite PMIs, followed by an ECB Non-Monetary Policy Meeting; In the United Kingdom, the Manufacturing and Services PMIs, along with the CBI Business Optimism Index and CBI Industrial Trends Orders; In China, the FDI Year-to-Date; In the United States, Initial Jobless Claims, the Chicago Fed National Activity Index, and the Manufacturing, Services, and Composite PMIs. See the full calendar here.

  • Dollar index: 98.670
  • Gold: $4,716
  • Crude Oil (BRENT): $102.81 (WTI) $93.17
  • United States 10 years: 4.32%
  • BITCOIN: $77,822

In corporate news:

  • J Sainsbury shares fell after the retailer's full-year results and 2026 profit guidance came in below market expectations, with management warning that Middle East tensions could hurt earnings.

  • Domino's Pizza Group said first-quarter trading was encouraging, with 5.8% system sales growth and unchanged full-year expectations supported by hedged costs and no current supply concerns.

  • Chinese and Hong Kong stocks closed lower as Middle East tensions hurt risk appetite, while Huaqin jumped on its Hong Kong debut and energy shares outperformed.

  • MongoDB will invest €74 million to expand its Irish engineering and AI operations, open a new Cork office, and create about 200 jobs by 2027.

  • American Water and Essential Utilities said Kentucky regulators approved their proposed merger, which is expected to close by the end of the first quarter of 2027.

  • GE Vernova secured orders from BBWind and Greenvolt Power to supply 71.5 MW of onshore wind turbines for projects in Germany.

  • Tesla increased its 2026 capital spending plan to more than $25 billion as it accelerates investment in AI, robotics, and chip development despite expectations for negative free cash flow later this year.

  • SpaceX told prospective investors it may manufacture its own GPUs as part of its AI and chip strategy, while warning that limited third-party chip supply could constrain growth.

  • Microsoft said it will invest A$25 billion by 2029 to expand cloud and AI infrastructure in Australia, marking its largest-ever commitment in the country.

Analyst Recommendations:

  • Csx Corporation: Morgan Stanley downgrades to underweight from market weight with a target price of USD 30.
  • Madison Square Garden Sports Corp.: Citi downgrades to neutral from buy and raises the target price from USD 337 to USD 355.
  • Mcdonald's Corporation: Rothschild & Co Redburn upgrades to neutral from sell with a price target raised from USD 260 to USD 306.
  • Texas Instruments Incorporated: Barclays upgrades to market weight from underweight and raises the target price from USD 175 to USD 250.
  • Valero Energy Corporation: Zacks upgrades to outperform from neutral and raises the target price from USD 250 to USD 268.
  • Bellring Brands, Inc.: Morgan Stanley maintains its overweight recommendation and reduces the target price from USD 32 to USD 24.
  • Boston Scientific Corporation: Canaccord Genuity maintains its buy recommendation and reduces the target price from USD 109 to USD 71.
  • Fair Isaac Corporation: Autonomous Research maintains its underperform recommendation and reduces the target price from USD 1007 to USD 800.
  • Ge Vernova Inc.: Barclays maintains its overweight recommendation and raises the target price from USD 993 to USD 1250.
  • Iac Inc.: KeyBanc Capital Markets maintains its overweight recommendation and raises the target price from USD 41 to USD 51.
  • Ionq, Inc.: Zacks maintains its neutral recommendation and raises the target price from USD 34 to USD 49.
  • Lam Research Corporation: Berenberg maintains its buy recommendation and raises the target price from USD 265 to USD 335.
  • Marriott International, Inc.: Susquehanna maintains its neutral recommendation and raises the target price from USD 280 to USD 385.
  • Servicenow, Inc.: Cantor Fitzgerald maintains its overweight recommendation and reduces the target price from USD 200 to USD 122.
  • Sitime Corporation: Loop Capital Markets maintains its buy recommendation and raises the target price from USD 450 to USD 600.
  • Td Synnex Corporation: Goldman Sachs maintains its buy recommendation and raises the target price from USD 205 to USD 270.
  • Tractor Supply Company: Daiwa Securities maintains its neutral recommendation and reduces the target price from USD 52 to USD 41.
  • Vertiv Holdings Co: CTBC Securities Investment Service Co LTD maintains its buy recommendation and raises the target price from USD 271.17 to USD 353.16.