U.S. stock index futures declined Thursday as mounting geopolitical tensions between the United States and Iran drove crude oil prices higher, adding to investor concerns about inflation and economic headwinds. The market pullback was compounded by mixed signals from the Federal Reserve, with minutes from January's policy meeting revealing internal disagreement over the timing and magnitude of potential interest rate adjustments this year.
Market participants have largely priced in expectations for two rate reductions by the end of 2024, though the CME FedWatch tool indicates a 94% probability that the central bank will maintain rates unchanged at its March meeting. This disconnect between market hopes and Fed policy guidance underscores the uncertainty surrounding monetary policy and has created a cautious tone among equity investors heading into the earnings season.
Individual stock movements reflected mixed fundamentals across key sectors. Walmart shares declined in premarket trading following a downwardly revised first-quarter outlook, while food delivery platform DoorDash gained on upbeat forward guidance and eBay advanced following strong quarterly results and its acquisition of fashion resale platform Depop. These divergent moves highlight selective investor interest despite broader market headwinds.