Stocks Retreat as Brent Pushes Further Above $70: Markets Wrap
(Bloomberg) — A rebound in US stocks faded as concerns about a possible conflict between the US and Iran sapped risk sentiment. Oil extended its rally.
S&P 500 contracts reversed early gains to fall 0.2%. Losses deepened after the head of the United Nations nuclear watchdog warned that Iran’s window for a diplomatic deal on its atomic program is closing. Brent rose above $71 a barrel, while West Texas Intermediate was near $66.
Nasdaq 100 futures fell 0.4% as technology stocks came under new pressure. Most members of the Magnificent Seven dropped in premarket trading, while an ETF tracking software firms edged lower as well. Gold erased an advance above $5,000 an ounce. Treasuries extended their slide while the dollar was flat.
The risk of conflict in the Middle East has emerged as a new worry for traders after technology stocks drove sharp swings in recent weeks. Investors remain wary of further slowing in the S&P 500’s strongest driver of the past three years, amid concerns that AI could disrupt entire sectors and that heavy capital spending wouldn’t pay off.
“What’s really interesting is that there seems to be no long-short strategy at play,” said Alexandre Baradez, chief market analyst at IG in Paris. “This will continue at least until the next earnings season when we’ll get more insight. In the meantime, all eyes will be on Nvidia’s results next week.”
Treasuries are on course for their longest losing streak in a month as tensions in the Middle East fuel oil-driven inflation fears. The 10-year yield rose for a third day, up one basis point to 4.09%.
Inflation concerns are already at the forefront of investors’ minds after minutes of the Federal Reserve’s January policy meeting showed several officials suggested that the central bank may need to raise rates if price growth remains stubbornly high.
Traders will focus on weekly US jobless claims due Thursday, to corroborate views that downside risks to employment have moderated in recent months. The Philadelphia Fed’s manufacturing index is expected to post a second straight monthly gain for the first time since September.
Rotation Play
Elsewhere, European stocks fell from a record high on a busy day for earnings, with Airbus SE retreating 7% on disappointing delivery guidance. Asian stocks advanced 0.5%, led by gains in South Korea as traders returned after the Lunar New Year holiday.
Simmering geopolitical risks and still-elevated tech valuations could fuel further rotation out of megacaps and into defensive sectors, said Craig Cameron, a portfolio manager at Templeton Global Investments. Still, the vast amount of capital expenditure shows that exposure to technology remains vital, he said.
“These sectors that are feeding into the AI capex cycle and the electrification cycle, those are the right places to be,” he said. “As valuations move higher, the right thing to do is to move into unloved areas and reduce that overweight over time.”
Corporate Highlights:
Walmart Inc. issued a forecast for full-year earnings that missed higher expectations, flagging the unpredictable state of trade and labor market conditions. OpenAI is close to finalizing the first phase of a new funding round that is likely to bring in more than $100 billion, according to people familiar with the matter, a record-breaking financing deal that would give the startup additional capital to build out its artificial intelligence tools. Carvana Co. suffered from some growing pains in its push for rapid growth as the company’s higher costs hit margins in the latest quarter and sent shares tumbling. Deere & Co. boosted its profit outlook for the year as the world’s largest farm-machinery maker anticipates the agriculture economy will get better soon. Airbus SE said the lack of reliable engine supplies for its A320 family of jets is holding back production and aircraft deliveries, extending the planemaker’s struggles to meet record demand for its bestselling model. Renault SA expects profitability to decline this year as the automaker rolls out new electric models including the Twingo and grapples with rising competition in Europe. Rio Tinto Group posted flat full-year profit, as improvements in copper and aluminum failed to offset a combination of one-off restructuring costs, US tariffs and China’s drag on its key iron ore unit. Some of the main moves in markets:
Stocks
S&P 500 futures fell 0.2% as of 7:13 a.m. New York time Nasdaq 100 futures fell 0.4% Futures on the Dow Jones Industrial Average fell 0.4% The Stoxx Europe 600 fell 0.6% The MSCI World Index fell 0.1% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1777 The British pound fell 0.2% to $1.3463 The Japanese yen rose 0.1% to 154.64 per dollar Cryptocurrencies
Bitcoin rose 0.3% to $66,510.71 Ether rose 0.5% to $1,950.36 Bonds
The yield on 10-year Treasuries advanced one basis point to 4.09% Germany’s 10-year yield advanced one basis point to 2.75% Britain’s 10-year yield advanced two basis points to 4.39% Commodities
West Texas Intermediate crude rose 1.4% to $66.12 a barrel Spot gold rose 0.2% to $4,987.43 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Julien Ponthus.
©2026 Bloomberg L.P.
