U.S. stock futures declined early Thursday amid a difficult confluence of strengthening oil prices, geopolitical tension and new concerns over AI spending. Traders were unsure and decided to hold back from the market open.

Wall Street Futures Point Lower

Futures based on the Dow Jones Industrial Average closed at 52,220 down 0.44%. S&P 500 futures slipped 0.39% to 7,511, while Nasdaq 100 futures lost 0.47%, dropping to 29,044. The early moves mark a cautious opening to the trading day as investors consider a variety of risks simultaneously.

Oil Prices Jump on Middle East Tensions

Oil markets were in the spotlight as Brent crude rose 4.79% to $98.58 a barrel, its highest level in weeks. U.S. West Texas Intermediate crude also climbed past $90 a barrel. The rise occurred after Saudi Arabia’s two tankers in the Red Sea were attacked. The strikes were attributed to Yemen’s Houthi movement, known to have ties to the Iranian regime.

This surge has engendered concerns over possible supply disruptions and an increase in inflation. Rising fuel costs could also push central banks to keep interest rates high for longer, adding more pressure on stocks.

AI Spending Concerns Rattle Tech Stocks

Technology stocks added to their woes when shares of Alphabet soured on news that it plans to increase its capital expenditure in 2026 to $195 billion to $205 billion. While the company did deliver strong earnings, investors are now more skeptical of the pace at which this AI investment will yield results.

The news buoyed a weak Wednesday as the Dow edged down 6.06 points, the S&P 500 pulled back 0.14%, and the Nasdaq Composite dropped 0.57%.

What Investors are Watching Next

One of the busiest weeks of earnings season is underway in markets. Investors are waiting for Intel, American Airlines, T-Mobile, Union Pacific and Norfolk Southern.

Soaring oil prices and a sluggish recovery in AI investments are two key forces moving the needle for investors. Many will watch closely to see if other tech giants follow Alphabet’s lead and raise their own spending plans, while keeping an eye on how the Middle East conflict affects global energy supply.

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