Wall St futures muted as oil tops $100 for first time since July
SPY•Futures subdued as oil jumps past $100
U.S. stock index futures were subdued on Wednesday as oil prices blew past $100 for the first time since July amid an intensifying Middle East conflict, keeping investors cautious ahead of inflation data later this week.
Investors have struggled to look past the U.S.-Iran war — which has dragged into its seventh month and raised the risk of a broader regional conflict — owing to its impact on oil prices and inflation.
Federal Reserve Chair Kevin Warsh's focus on controlling prices has also led traders to expect an interest rate hike this month. Markets now see a 60.4% chance that rates will be increased by 25 bps when the central bank meets next week, according to data from the CME FedWatch tool.
"Higher oil and rates remain the main risks to equities in the near term. It is well understood now that strategic reserves have been drawn down substantially to cushion oil prices," wrote Morgan Stanley analysts, led by chief U.S. equity strategist Mike Wilson.
