US stock futures stepped higher on Wednesday, pointing to continued recovery after the Iran war shock as investors waited for the Federal Reserve’s latest policy decision.

Dow Jones Industrial Average futures (YM=F) moved up 0.2% following a second winning day in a row for Wall Street stocks. Contracts on the S&P 500 (ES=F) also put on 0.2%, while those on the tech-focused Nasdaq 100 futures (NQ=F) gained 0.3%.

Markets are cautiously adjusting to the Middle East conflict, shifting toward pricing in the spillover rather than reacting to the shock. The killing of another top Iran official came after Tehran vowed revenge, while a fresh round of rhetoric from President Trump failed to dampen war fears. Amid the hostilities, the market focus stayed firmly on when the Strait of Hormuz might reopen to ease pressure on oil prices — a prospect seen as unlikely without a ceasefire.

Against that backdrop, Brent crude futures (BZ=F) rose to near $105 a barrel, continuing their recent surge after Iran said some of its energy facilities had come under attack. West Texas Intermediate crude futures (CL=F) pared earlier morning losses to trade near $95.

Wall Street is bracing for the Fed's policy decision later Wednesday, and for what Chair Jerome Powell might say about the potential inflationary impact of high oil prices in his comments. They'll also digest the central bank's Summary of Economic Projections, which will shed light on policymakers' expectations for inflation, the labor market, and the US economy as a whole. Markets broadly expect policymakers to leave rates unchanged in a 3.5% to 3.75% range.

On the corporate front, investors are watching Micron Technology (MU), which is set to report quarterly results after Wednesday’s close. General Mills (GIS) and Macy's (M) also report on Wednesday.

Oil prices ticked up in early morning trading on Wednesday as a bevy of headlines and attacks in the Middle East reinforced the risk facing energy markets.

Futures on Brent crude (BZ=F) picked up 3%, or roughly $3 per barrel, in the hours since 12 a.m. ET, while those on West Texas Intermediate (CL=F) gained 2%, or around $1.50.

On Monday morning, Iran confirmed the killing of Supreme National Security Council secretary Ali Larijani, a key leader for the regime, but said its leadership remains strong and committed to keeping the Strait of Hormuz closed.

The Iranian regime also said the US and Israel struck the massive offshore South Pars gas field, which Iran shares with Qatar — but Iran did not elaborate past saying the field was hit by airstrikes. Such a development would likely mark the first time since the outbreak of conflict in February that the US and Israel have targeted Iran's energy infrastructure.

Axios reported around 8 a.m. ET Wednesday morning that the Israeli military had struck a gas facility inside Iran with the approval of the US, citing a senior Israeli official.

At the same time, upward price action is likely muted by the news that Iraq and the semi-autonomous Kurdistan region have reached an agreement to restart Iraqi crude exports through the Kirkuk-Ceyhan pipeline to the Turkish Mediterranean port of Ceyhan. However, the pipeline is only expected to have a capacity of roughly 250,000 barrels per day.

In the physical market, spot prices for Dubai and Oman oil grades are trading around $158 per barrel, or roughly $55 above the benchmark Brent futures contract, according to Bloomberg data, suggesting that the futures market could be significantly lagging reality.

Lumentum (LITE) and Coherent Corp (COHR) stocks rose 7% and 6% before the bell on Wednesday as investors weighed the latest comments from Nvidia (NVDA) about the role of optical networking. Lumentum, which is the market leader and manufacturer of optical and photonic products, saw its stock price swing on Tuesday after Nvidia said it would use both copper and optical networking during its GTC conference.

Boston Beer's (SAM) stock fell 2% during premarket hours today. The beer company announced on Monday it will repurchase up to $25 million of its stock through a 10b5-1 plan.

Micron (MU) stock rose 2% before the bell on Tuesday. The digital memory and storage provider announced plans to build a second chip manufacturing facility in Taiwan on Monday and will report its earnings after the close today.

Macy’s (M) posted better-than-expected fourth quarter earnings results as the department store chain heads into the third year of its turnaround strategy, called Bold New Chapter.

Adjusted earnings per share for the holiday quarter came in at $1.84, above the $1.54 the Street estimated, according to Bloomberg. Revenue came in at $7.6 billion, just above the $7.5 billion the Street was looking for.

The stock rose nearly 7% in premarket trading

Overall, same-store sales increased 1.8%, compared to 0.12% decline the Street forecast. Comparable sales grew by 2% for stores that Macy's plans to keep open — those it invested in with new merchandise and more staff.

Same-store sales for its luxury business, Bloomingdale’s, grew nearly 10% during the quarter, which CEO Tony Spring said “underscores its ability to elevate the customer experience and capture demand across premium contemporary to luxury businesses" in the release. Wall Street analysts only expected a 2.5% pop.

Spring added, "At Macy’s, we are offering more relevant brands, stronger storytelling and investing in our colleagues so we can better serve the customer … looking to 2026 and beyond, we are ready to build on our progress.”

The company beat all key metrics, including earnings, revenue, and same-store sales growth, for its fiscal 2025 results.

For the upcoming fiscal year, it expects adjusted earnings to be in the range of $1.90 to $2.10, below the $2.21 the Street expected. That’s alongside revenue of $21.4 billion to $21.65 billion, which was above Wall Street’s predicted outlook of $21.1 billion.

Meanwhile, same-store sales are expected to range from a 0.5% decline to a 0.5% increase. The Street was looking for a 0.5% increase for this year.

From Bloomberg:

US President Donald Trump is desperate to reopen the Strait of Hormuz to ease a growing global energy crisis. He won’t achieve that easily without a ceasefire in the war on Iran.

... Trump has been pressing allies to send warships to help reopen the strait, proposing a multinational naval effort to escort commercial ships.

European and Asian partners are reluctant, with governments from Berlin to Tokyo questioning whether a handful of ships would make any difference against Iran’s ability to threaten vessels. Officials say additional navies would add little beyond the substantial US presence already in the region — and still fall far short of what’s needed to meaningfully unblock the strait.

“It could take several weeks to secure the Strait of Hormuz,” said Bob McNally, president of Rapidan Energy Group and a former White House official. “Until we’ve neutralized Iran’s layered, asymmetric capabilities — mines, fast attack craft, submarines and drones — we won’t want to put commercial or even escort ships through.”

Read more here.

New Fortress Energy (NFE) shares jumped 10% before the bell on Wednesday after announcing a massive debt restructuring deal. The plan cuts their debt from $5.7 billion down to $527.5 million and splits the company into two.

MT Newswires reports:

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Gold futures traded near $5,000 an ounce on Wednesday as investors weighed the Federal Reserve's rate-cut path against inflationary risks from the war in the Middle East.

Bloomberg News reports:

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Reuters reports:

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Bloomberg reports:

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