US Stock Market Live: Oil and yields jump in 2026

Wall Street set for a muted start as tensions rise

US stock futures pointed to a tepid start on Thursday as fresh tensions between the US and Iran weighed on risk appetite. The flare-up dampened investor hopes of a swift resolution to the conflict and brought energy and bond markets back into focus. Oil prices rose more than 2%, while US Treasury yields moved higher, reflecting renewed inflation concerns. Continued disruption around the Strait of Hormuz added to worries about how long energy prices could remain elevated. With inflation still a key variable for markets, traders also turned their attention to the day’s scheduled data releases.

What triggered the latest shift in sentiment

The latest bout of caution followed reports that Iran targeted a US airbase after Washington carried out fresh strikes. The development escalated geopolitical concerns and came soon after President Donald Trump dismissed reports suggesting the US was close to reaching a compromise with Iran. The sequence of events reduced expectations for near-term de-escalation and brought back concerns over shipping and energy supply routes. Markets have been particularly sensitive to developments linked to the Strait of Hormuz because of its importance to global oil flows. As tensions built, investors rotated towards pricing in higher energy-linked inflation risks.

Futures snapshot: early read on Thursday’s open

As of 4:54 a.m. ET, US index futures were modestly lower, pointing to a cautious start rather than a broad sell-off. The moves suggested investors were watching headlines closely while holding back from aggressive positioning ahead of macro data.

Oil and the inflation channel back in the spotlight

Oil’s move higher was central to the shift in tone. The market reaction reflected concerns that prolonged disruption around the Strait of Hormuz could keep energy prices elevated and feed into broader inflation. Higher fuel costs can transmit into transport, logistics, and manufacturing, and can also pressure household budgets. Because of this link, oil price spikes often influence expectations about central bank policy even when broader inflation trends appear to be stabilising. In this update cycle, the oil move was paired with rising bond yields, a combination that can tighten financial conditions.

Treasury yields climb as markets reassess the Fed path

US Treasury yields moved higher as markets re-evaluated the outlook for monetary policy amid oil-driven inflation fears and firmer economic readings. The two-year Treasury yield rose to 3.85% from 3.76% late Wednesday, touching its highest level since the summer. The 10-year Treasury yield climbed to 4.28% from 4.26% late Wednesday and from 3.97% before the Iran war began. Reports cited stronger-than-expected economic data as an additional support for yields, including fewer Americans filing for unemployment benefits than economists expected and an acceleration in mid-Atlantic manufacturing activity. Higher yields can pressure equities by increasing borrowing costs and lowering the relative appeal of risk assets.

Investors await the PCE inflation report under new Fed leadership

Markets were also focused on the personal consumption expenditures (PCE) report, which includes the Federal Reserve’s preferred inflation gauge. The data is being watched for clues on the future path of monetary policy under new Fed Chair Kevin Warsh. According to the update, traders expected the Fed to keep interest rates unchanged for most of the year. However, some market participants were pricing in the possibility of a 25-basis-point rate hike in December. With geopolitical risks lifting oil and yields, the inflation data became even more important for how investors shape expectations for policy moves.

Wednesday’s close: Dow ends at a record as AI rally pauses

The cautious tone into Thursday followed a steadier midweek session in cash equities. On Wednesday, the Dow Jones Industrial Average rose 182.60 points, or 0.36%, to 50,644.28, marking a record closing high. The move was supported by rising healthcare and consumer stocks. The S&P 500 gained 1.24 points, or 0.02%, to 7,520.36, while the Nasdaq Composite added 18.55 points, or 0.07%, to 26,674.74. The update noted that investors appeared to take a pause from the AI-led rally while closely watching Middle East peace talks.

Volatility across the week: sharp swings in futures, sectors in focus

Other live-market snippets highlighted how quickly sentiment has shifted with headlines. At one point, futures were reported higher, with Dow E-minis up 299 points (0.66%), S&P 500 E-minis up 41 points (0.64%), and Nasdaq 100 E-minis up 138.5 points (0.59%) at 07:24 a.m. ET. But another update showed a steep risk-off move, with Nasdaq 100 E-minis down 579.5 points (2.32%), S&P 500 E-minis down 124.5 points (1.84%), and Dow E-minis down 858 points (1.76%) at 05:59 a.m. ET as investors assessed inflation and trade implications from the conflict.

The same update cycle flagged pressure in select stocks tied to travel and big technology. Delta and Royal Caribbean were reported down about 4% each, while Nvidia and Microsoft were down 3.1% and 1.8%, respectively, after gains in the previous session. Rate expectations also moved, with investors pushing back expectations for a 25-basis-point rate cut by the Federal Reserve to September from July, according to LSEG-compiled data.

Key numbers and headlines to track

The market’s focus remained split between energy disruptions and policy signals. Oil prices were volatile in reported updates, including an instance where West Texas Intermediate crude futures retreated 2.3% to $13.39 per barrel and Brent futures fell 1.5% to $18.93 per barrel. Bond markets were also described as volatile in parts of the coverage, including a reading where the 10-year yield dipped 1.3 bps to 4.13%, and another where it held steady at 4.06%. Meanwhile, Trump warned on social media that if Iran stopped oil flows in the Strait of Hormuz, it would be hit “TWENTY TIMES HARDER.”

Why the oil-yields mix matters for equities

For equity investors, the combination of rising oil prices and rising yields can be challenging. Oil increases can revive inflation fears, while higher yields tighten financial conditions by pushing up the discount rate used for valuing future earnings. This is especially relevant for high-duration sectors such as technology, which can be sensitive to changes in rates. At the same time, the macro picture is complicated by the day’s data calendar, including the PCE report, and by scheduled remarks from Fed officials including John Williams, Jeffrey Schmid, and Neel Kashkari, as cited in the live update feed.

Conclusion

US stock futures suggested a cautious start to Thursday as US-Iran tensions lifted oil prices and Treasury yields, while investors waited for the PCE inflation report for clearer guidance on Fed policy under Chair Kevin Warsh. With geopolitics and inflation both influencing rates, markets are likely to remain sensitive to headline-driven moves alongside key data releases.