U.S. stock futures traded near the flatline early Friday after a sharp market decline in the previous session, as soaring oil prices and disappointing earnings from two megacap technology companies weighed on investor sentiment.
S&P 500 futures were largely unchanged, while Nasdaq-100 futures slipped 0.26%. Dow Jones Industrial Average futures edged about 20 points lower.
On Thursday, Wall Street posted broad losses. The Dow Jones Industrial Average fell more than 500 points, marking its fifth decline in six sessions. The S&P 500 and Nasdaq recorded their steepest one-day drops since June 23, falling 1.2% and 2.2%, respectively.
Asian markets also came under pressure. Japan’s Nikkei 225 dropped 2.79%, while the Topix lost 1%. South Korea’s Kospi fell more than 5%, and the Kosdaq declined 4.95%. Australia’s S&P/ASX 200 slipped 0.95%, Hong Kong’s Hang Seng fell 1.33%, and China’s CSI 300 lost 1.4%.
Oil prices surged after reports that two Saudi oil tankers were struck in the Red Sea. Brent crude climbed above $100 per barrel for the first time since late May, gaining about 7%, while U.S. West Texas Intermediate crude advanced roughly 6%. Both benchmarks traded slightly higher during Friday’s Asian session.
Investor sentiment was further dampened by earnings from Tesla and Alphabet. Tesla plunged nearly 15% after missing second-quarter earnings expectations, marking its biggest single-day decline since March 2025. Alphabet also fell 7% after raising its full-year capital expenditure outlook, recording its largest daily loss since May 2025.
With Thursday’s sell-off, major U.S. indexes are on track for weekly losses. The Dow and S&P 500 are down 0.8% and 0.7%, respectively, while the Nasdaq has fallen 1.5%, making it the week's weakest-performing major index.
Frequently Asked Questions
Why did the stock market fall despite no major economic data release?
The sell-off was driven by a sharp rise in oil prices, disappointing earnings from Tesla and Alphabet, and increased geopolitical tensions, which collectively reduced investors' appetite for risk.
How do higher oil prices affect stock markets?
Rising oil prices can increase business costs, fuel inflation, and raise concerns that central banks may keep interest rates higher for longer—factors that often weigh on equities.
Why did Tesla and Alphabet have such a big impact on the market?
Both are among the largest companies in the market. Tesla's earnings miss and Alphabet's higher capital spending guidance sparked broad selling in the technology sector, pulling major indexes lower.
What should investors watch next?
Keep an eye on oil price movements, upcoming corporate earnings, inflation data, and any developments in the Middle East, as these factors could shape market direction in the coming sessions.
