U.S. stock futures traded modestly lower on Thursday as investors attempted to reconcile a stream of often-contradictory reports about potential diplomacy to halt the war involving Iran. Energy markets remained on edge, with crude hovering back above $100 a barrel, while the dollar gained ground and gold retreated. In corporate news, Jefferies Financial reported first-quarter losses tied to loans made to companies that collapsed, offsetting stronger returns from its investment banking business.
1. Futures inch lower
By 04:18 ET (08:18 GMT), futures tied to the main U.S. indices were lower: the Dow futures contract was down 203 points, or about 0.4%, the S&P 500 futures had shed 35 points, or roughly 0.5%, and Nasdaq 100 futures were lower by 156 points, or about 0.6%.
Those moves came after the major averages on Wall Street rose in the previous session amid hopes that the United States and Iran might be amenable to talks aimed at ending the nearly month-long conflict. Various media reports suggested Tehran has privately signaled a willingness to enter discussions with Washington. At the same time, U.S. Vice President JD Vance was reported to be potentially ready to travel to Pakistan for negotiations as soon as this weekend.
Other coverage indicated the U.S. and Israel could refrain from attempts on the lives of Iran's foreign minister or the speaker of parliament while communications proceed. Yet the overall tone from the region has been inconsistent: the two sides remain separated by wide gaps on the terms they would accept to stop hostilities, and the Pentagon has been moving to position additional ground troops in the Middle East.
Israeli officials, who have coordinated military efforts with the United States, reportedly voiced concern that the U.S. might announce a one-month ceasefire. In response, Prime Minister Benjamin Netanyahu has ordered a renewed two-day push intended to destroy as much of Iran's military capability as possible, according to the press reports cited in coverage.
2. Oil hovers above $100 a barrel
With market participants sorting through the cascade of developments from the Middle East, crude prices again rose above the $100-per-barrel threshold. The futures contract for Brent crude due in May was last higher by 3.4% at $105.73 a barrel, while U.S. West Texas Intermediate futures gained 3.7% to $93.67 a barrel.
Reports indicated Iran is reviewing a 15-point proposal put forward by the United States. At the same time, the White House signaled that additional air strikes would follow if no deal is reached. White House Press Secretary Karoline Leavitt was quoted as saying that President Donald Trump "does not bluff and [...] is prepared to unleash hell," while other coverage reported that the president has privately told aides he would like to bring the war to a swift conclusion.
Analysts at Vital Knowledge noted that the administration has communicated an official date of May 14-15 for the president's upcoming trip to China, which they suggested could imply an expectation that the conflict will be resolved by that time.
Perhaps most consequential for energy flows, the Strait of Hormuz remains effectively closed. That narrow waterway, through which roughly a fifth of the world's oil and natural gas moves, has been largely shuttered by the threat of Iranian strikes for weeks. Although oil has eased from an earlier surge toward nearly $120 a barrel earlier this month, prices remain markedly above the levels seen before the outbreak of hostilities in late February.
3. Dollar firms
The return of oil above $100 a barrel has helped support the U.S. dollar, even as some aspects of risk sentiment have improved, according to analysts. The dollar has acted as one of investors' go-to safe havens since the start of the conflict, strengthening by about 2% over the past month.
A gauge tracking the dollar against a basket of currencies — which has been volatile this week amid the stream of Iran-related headlines — was last up 0.1% at 99.70. Analysts at ING, including Francesco Pesole and Chris Turner, cautioned that markets may need more convincing signs of de-escalation before the dollar can move meaningfully lower from current levels.
4. Gold slips
Gold has felt some pressure from the dollar's relative strength, limiting a rebound in bullion prices after an earlier run-up to record levels earlier in the year. Some observers suggested that gold's strong gains in recent months may have reduced its marginal appeal for investors seeking alternative safe havens as the conflict widened across the region.
Expectations that the Federal Reserve could respond to an energy-driven spike in inflation by keeping interest rates higher for longer have also weighed on non-yielding assets such as gold. Spot gold was quoted lower by 1.7% at $4,432.27 an ounce by 05:02 ET, while gold futures had slipped 2.7% to $4,461.59 an ounce.
American Hartford Gold President Max Baecker said the market is trading within a defined near-term range, and that the point for a change of tone would be for the market to clear and hold the mid-$4,500s. Until that level is decisively surpassed, Baecker said rallies could run into resistance and become selling opportunities.
5. Jefferies earnings
In corporate results, Jefferies Financial delivered a mixed first-quarter report as losses tied to loans made to firms that collapsed weighed on the bottom line. After adjustments for compensation and taxes, Jefferies recorded $17 million in losses associated with the failures of British lender Market Financial Solutions and First Brands, an American auto-parts supplier that went bankrupt.
Those loan losses detracted from otherwise robust investment banking revenue. Jefferies' president, Brian Friedman, told reporters that the conditions for dealmaking and initial public offerings should remain "increasingly strong" provided the Iran conflict reaches a reasonable end.
Deal activity has shown notable momentum so far this year. Dealogic data indicate that more than $1 trillion of transactions have been announced in 2026 to date, a pace that is 27% higher than the same period in 2025. Analysts and market participants have highlighted the potential for several high-profile technology sector flotations later in the year, which could add to underwriting and advisory opportunities.
Market implications and near-term considerations
Across asset classes, the flow of often-conflicting information from the Middle East has created a challenging environment for positioning. Energy markets remain most directly affected by the physical and geopolitical realities of the conflict, with oil's path closely tied to the status of the Strait of Hormuz and any progress, or lack thereof, in talks.
Currency and commodity markets are also being influenced by expectations for central bank reaction functions. If higher energy prices feed through to inflation, markets are pricing the risk that central bankers will maintain elevated interest-rate settings for longer, a stance that typically supports the dollar and pressures non-yielding assets like gold.
Within financials, the environment for dealmaking may hinge on the trajectory of the conflict. Jefferies' results underscore how episodic credit losses can offset strength in underwriting and advisory fees, while the broader pipeline of announced deals suggests there is pent-up activity ready to move forward if market confidence holds.
For investors, the immediate outlook remains contingent on two largely interconnected developments: whether diplomacy produces credible signs of de-escalation and how persistent any energy-price shock becomes. Until clearer signals emerge, markets are likely to oscillate as headlines alternate between diplomatic openings and continued military maneuvering.