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U.S. stock futures were modestly lower, with Dow futures down 0.3% and S&P 500 and Nasdaq 100 futures each down 0.1%, after the S&P 500 and Nasdaq closed at fresh record highs. Geopolitical tensions in the Strait of Hormuz pushed crude higher, with WTI up 0.3% to $93.25 and Brent up 0.4% to $102.30, while the 10-year Treasury yield edged up to 4.32% and the dollar index rose 0.2% to 98.78. In premarket trading, IBM fell nearly 8% despite beating estimates, ServiceNow dropped 14% on soft subscription growth, Tesla fell 3%, and Intel rose 1.5% ahead of earnings.
The tape is starting to price in a classic “higher oil, lower beta” regime: energy and duration-sensitive growth are diverging while index-level complacency remains elevated near records. The immediate second-order effect is not just margin pressure for transport, software, and consumer discretionary; it is a subtle tightening of financial conditions via firmer yields, a stronger dollar, and reduced appetite for long-duration multiples. That combination is most damaging to stocks that need revenue acceleration or multiple expansion to justify current valuations.
The most interesting dislocation is in software and enterprise IT. ServiceNow’s move suggests investors are now willing to punish any guide that embeds even a hint of geopolitics-related softness in demand, which can spill over to adjacent subscription names with similar enterprise budget cycles. IBM’s selloff despite an earnings beat reinforces that “good enough” is no longer enough when the market is demanding either upward revisions or a cleaner AI monetization path; that raises the bar for the entire legacy-tech cohort and could redirect incremental capital toward names with visible AI attach rates rather than broad IT spending proxies.
The macro setup also argues for caution on the recent risk-on crypto leg. Bitcoin’s push toward a psychologically important level is happening alongside a mild bid in yields and oil, which makes it vulnerable if the market reverts to de-risking on any escalation in the Strait of Hormuz. In that scenario, high-beta assets likely underperform first, while defensives and energy retain relative support.
The consensus is probably underestimating how quickly record-high equities can become fragile when the market is forced to reconcile rising geopolitical tail risk with stretched multiples. If oil keeps grinding higher for another few sessions, the lagged impact on inflation expectations could matter more than the headline equity tape, especially for sectors that were bidding on a “soft landing plus rate cuts” path. In other words, the market is still celebrating the absence of a worst-case event rather than pricing the persistence of a worse-than-expected risk premium.
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