Equity Alert
US stock futures drop after attack on Iran; crude prices surge
This story was originally published at 07:51 IST on 2 March 2026
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Equity Alert: US stock futures drop after attack on Iran; crude prices surge
MUMBAI--0730 IST--Futures contracts of US benchmark indices slumped after the US, in co-ordination with Israel, conducted joint military operations against Iran over the weekend. This action resulted in the death of Iran's Supreme Leader, Ayatollah Ali Khamenei, reports confirmed. These operations have raised concerns over the operability of the Hormuz Strait, a major crude oil chokepoint, resulting in a surge in crude oil prices.
At 0721 IST, the March contract of the E-mini Nasdaq-100 futures was down 0.5% at 24884 points. The E-Mini Dow Future contract was down 0.6% at 48712 points.
"The tail risk of a sustained conflict is higher than in 2024 or 2025, though we don't see this war escalating to a point where it drastically changes the US outlook," CNBC quoted Ajay Rajadhyaksha from Barclays as saying. But in the first half of this week, "it is too early to buy any dip, especially with investors used to a pattern of quick de-escalation," he said.
Earlier on Monday, the May futures contract of Brent crude oil rose to an over one-year high of $82.37 per barrel. At 0721 IST, the contracts were up 5% at $76.19 per barrel. The oil market's trajectory depends on whether the fighting disrupts shipments through the Strait of Hormuz and a sustained interruption there could reverberate through global energy markets and reignite inflation pressures, CNBC said.
On Friday, benchmark indices in the US had closed lower, dragged down by financial services and technology stocks. The sell-off was driven by uncertainty over costs and disruption related to artificial intelligence, revived tariff uncertainties, and simmering geopolitical tensions, Reuters reported.
On the macroeconomic front, a hotter-than-expected Producer Price Index reading cut expectations of the US Federal Reserve cutting its key interest rate in the near term. Headline producer inflation came in at 2.9%, as opposed to 2.6% expected by the Street. Markets are currently pricing in a 95.6% probability that the central bank will leave the US Fed funds target rate in the 3.50-3.75% range at its upcoming monetary policy meeting in March, according to CME's FedWatch tool.
Following are the closing levels of US indices Friday:
| Index | Level | Change in % |
| S&P 500 | 6878.88 | (-)0.43 |
| NASDAQ Composite | 22668.21 | (-)0.92 |
| Dow Jones Industrial Average | 48977.92 | (-)1.05 |
(Eshitva Prakash)
US$1 = INR 90.975
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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