Investing.com -- U.S. stock futures continued to fall Thursday, with the situation in the Middle East remaining volatile and as investors awaited the all-important official jobs report at the end of the week.
By 06:00 ET (10:00 GMT), the Dow Futures contract was down 125 points, or 0.3%, S&P 500 Futures traded 18 points, or 0.3%, lower and Nasdaq 100 Futures dropped 78 points, or 0.4%.
The main indices ended near the flatline Wednesday after falling sharply on Tuesday, the first trading day of the new quarter, after Iran launched a barrage of missiles at Israel, escalating the tense situation in the Middle East.
Middle East hits risk assets
Risk sentiment has been hit hard this week by the escalation of the conflict in the Middle East, with Israel now considering its possible response to an aerial bombardment from Iran earlier in the week.
“Escalation in the Middle East has led markets to price in a greater risk of a fully-fledged conflict in the region, which could potentially involve the US,” analysts at ING said, in a note.
Jobless claims adds to labor data
Traders also remain wary ahead of Friday’s key nonfarm payrolls report, which is likely to set the market’s direction ahead of the Federal Reserve’s next rate-setting meeting.
Ahead of that release, markets will have the chance to parse through fresh weekly first-time claims for unemployment benefits and services activity data on Thursday.
So far this week the data – job openings and ADP private payrolls – have pointed to a reasonably healthy labor market, which have reduced expectations that the US central bank will follow last month’s 50 basis-point hike with another outsized move.
Levis Strauss slumps
In the corporate sector, Levi Strauss (NYSE:LEVI) stock fell sharply premarket after the jeans maker announced it has put its Dockers brand under review for a possible sale and lowered its group-wide full-year revenue forecast.
Tesla (NASDAQ:TSLA) stock also fell premarket, adding on the previous session’s 3% losses on disappointing third-quarter deliveries, after the U.S. National Highway Traffic Safety Administration said the EV manufacturer was recalling 27,185 Cybertruck vehicles in the U.S. as a delayed rear view image reduces visibility behind the vehicle.
Crude retains strength
Oil prices rose Thursday as the escalating violence in the Middle East raised concerns that crude flows could be disrupted from this key exporting region.
By 06:00 ET, the Brent contract climbed 1.8% to $75.22 per barrel, while U.S. crude futures (WTI) traded 2% higher at $71.50 per barrel.
Traders are waiting for Israel’s response to Iran firing more than 180 missiles into its territory on Wednesday, amid concerns it could target Iranian oil infrastructure.
Meanwhile, U.S. crude inventories rose by 3.9 million barrels to 417 million barrels in the week ended on Sept. 27, the Energy Information Administration said on Wednesday, compared with expectations for a 1.3 million-barrel draw.