Dow, S&P 500, Nasdaq Futures Creep Higher As Fed Decision Tops Iran, Oil Fears: Why SWRM, MU, ONDS, SOFI, LULU Are In Focus

• Traders looked past rising oil prices and tensions over the war in Iran, focusing on the Federal Reserve’s upcoming rate decision.
• Iranian attacks on the UAE's energy infrastructure and ongoing disruption in the Strait of Hormuz intensified global concerns about oil supply.
• Focus remains on the Fed's decision due Wednesday, with rates expected to stay unchanged.

U.S. stock futures climbed cautiously late Tuesday as traders looked past spiking oil prices and Iran war tensions, turning their attention to the Federal Reserve's policy decision due Wednesday.

As of 10:40 p.m. ET, S&P 500 and Dow Jones futures were both up about 0.2%, while Nasdaq futures rose 0.4%.

On Stocktwits, retail sentiment toward the SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust (QQQ) was ‘extremely bearish’ amid ‘high’ message volume, while sentiment toward the SPDR Dow Jones Industrial Average ETF Trust (DIA) was ‘bearish’ amid ‘normal’ message volume.

US Market Drivers

On Tuesday, markets extended gains for a second straight session, supported by dip-buying despite geopolitical uncertainty:

Crude oil prices continued their rally, with West Texas Intermediate rising nearly 3% to $96.21 and Brent crude gaining 3.2% to $103.42, its highest close since August 2022. 

The surge followed Iranian attacks on energy infrastructure in the UAE, including strikes on a major gas field and the suspension of operations at the Fujairah oil loading port, as well as continued disruptions to tanker traffic through the Strait of Hormuz.

The conflict escalated further after Iran confirmed the death of its security chief, Ali Larijani, in airstrikes, while Israel also reported the development, marking a significant intensification in the ongoing war. The Strait of Hormuz remains effectively constrained, with limited tanker movement, raising concerns over global energy supply disruptions. 

U.S. President Donald Trump said on Truth Social that the country no longer needed assistance from NATO allies to secure shipping routes in the region, after earlier signaling a potential coalition. 

What Will The Fed Do?

Investors are now focused on the Federal Reserve’s interest rate decision expected on Wednesday, with rates widely anticipated to remain unchanged at 3.5% to 3.75%. Traders will also watch closely for any commentary from Chair Jerome Powell on whether elevated oil prices and geopolitical risks could influence future policy.

A Stocktwits poll also showed that an overwhelming majority of retail traders expect the central bank to hold rates steady on Wednesday, as the market debates whether the Iran conflict will throw a wrench into economic growth or create more inflation.

Blake Millard, director of investments at Sandbox Financial Partners, said on X that major oil supply shocks show “large potential downside risk,” adding that the S&P 500 has historically declined a median 12% during such episodes and seen peak-to-trough drawdowns of about 23%.

Meanwhile, the Kobeissi Letter said on X that investors are turning defensive, noting that cash allocations have surged to 4.3%, the fastest shift since the pandemic, reflecting caution amid escalating tensions.

Trending Stocks To Watch On NYSE, Nasdaq

Swarmer (SWRM): The stock closed up 520% in its trading debut on Tuesday after pricing its IPO at $5 per share, triggering multiple volatility halts.

Micron Technology (MU): The stock hit an all-time high on Tuesday and rose in after-hours trading ahead of its earnings, with analysts expecting revenue to jump 138% and profit to surge 455%.

Ondas Holdings (ONDS): The stock posted its best session in a month after announcing the acquisition of INDO Earth Moving to expand into autonomous defense and military engineering programs.

SoFi Technologies (SOFI): The stock fell over 1% in regular trading but rose 0.6% in extended trading after Muddy Waters disclosed a short position alleging “Enron-esque” off-balance-sheet practices, while CEO Anthony Noto bought $500,516 worth of shares.

Lululemon Athletica (LULU): The stock fell nearly 2% after hours after issuing a weaker-than-expected FY26 outlook despite a board reshuffle and ongoing activist pressure for leadership changes.

How Global Markets Are Performing Today

In broader markets, the yield on the benchmark 10-year U.S. Treasury note was around 4.21%, while gold traded near $5,000 an ounce.

Asian markets were mixed, with gains in Japan and Australia, while MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.08%.

Among the catalysts for the day are the Federal Reserve’s interest rate decision and a packed economic calendar, including producer price index data, mortgage applications, factory orders, and durable goods orders, offering further insight into the state of the U.S. economy.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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