Wall Street futures fell, with Dow futures down 0.33%, S&P 500 futures down 0.57% and Nasdaq 100 futures down 1.01%, as the Middle East conflict continued and investors awaited Trump-Xi talks. Investors also priced in a 71% chance of a Federal Reserve rate hike next month.
At 5:25 a.m. ET, Dow E-minis were down 173 points, or 0.33%; S&P 500 E-minis fell 44.25 points, or 0.57%; and Nasdaq 100 E-minis dropped 309.75 points, or 1.01%. Brent crude rose above $100 a barrel after US and Iranian leaders exchanged barbs at the UN General Assembly.
Higher energy costs and data suggesting strong business activity led investors to bet on further Federal Reserve rate increases. Markets priced in a 71% chance of at least a 25-basis-point hike next month, up from about 50% a day earlier. New York Fed President John Williams said it was reasonable to think rates might need to be raised again this year.
Airline and cruise shares declined, while AI-related stocks including Meta, Nvidia, Marvell and Intel also fell. Investors were watching for discussions about AI regulation, the Middle East and Taiwan at the Trump-Xi summit. Treasury Secretary Scott Bessent said the United States and China had agreed to extend their truce until January 10.
