Middle East Tensions Escalate as Iran Closes Strait of Hormuz

U.S. equity futures declined Thursday morning following reports of significant civilian casualties in Lebanon resulting from Israeli strikes. The attacks occurred despite an active ceasefire in the Middle East, with Israel asserting that Iran-backed Hezbollah forces are not covered under the current agreement. The situation escalated rapidly as Iran condemned the strikes and announced the closure of the Strait of Hormuz, one of the world's most vital maritime corridors for oil exports. In response to the instability, U.S. President Donald Trump has warned that strong action will be taken if Iran fails to adhere to the terms of the ceasefire. Commodity markets reacted immediately to the supply risk, with benchmark Brent crude rebounding more than 3% to trade at $98.15 a barrel. Precious metals showed mixed results, as spot gold edged up 0.3% to $4,731.56, while June gold futures dipped 0.5% to $4,755.47. Wall Street is expected to open lower, with Dow futures losing 183 points, S&P 500 futures down 18.75 points, and Nasdaq 100 futures sliding 45.75 points. This bearish sentiment was mirrored in Asia, where the Nikkei 225 fell 0.73% and the Shanghai Composite dropped 0.72%. Investors are now weighing these geopolitical shocks against a heavy slate of U.S. economic data. Key releases scheduled for this morning include fourth-quarter GDP, with a consensus estimate of 0.7%, and weekly jobless claims, expected at 213,000.