S&P futures declined on Wednesday following President Donald Trump’s indication that negotiations with Iran were progressing too slowly, coupled with his threat of further action. Oil prices experienced an uptick following comments made by Trump. S&P 500 futures and Nasdaq 100 futures declined by 0.95% and 1.41%, respectively. Futures associated with the Dow Jones Industrial Average declined by 449 points, representing a decrease of 0.9%. Chip stocks faced renewed pressure in early trading, which also impacted futures. Trump stated on Wednesday morning that Iran has “taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!.” West Texas Intermediate crude futures experienced an increase of approximately 1.4%, currently trading at around $89.37 per barrel.

Tensions in the Middle East escalated once more on Tuesday evening, following the launch of strikes by U.S. forces against Iran, described by U.S. Central Command as a response to the previous day’s downing of a U.S. Army Apache helicopter. Trump previously alleged that Iran was responsible for the downing of the helicopter, which he claimed was conducting patrols over the Strait of Hormuz. Shares of Micron, AMD, and Broadcom experienced declines in early trading, marking a trend where chip stocks have recorded losses in four out of the last five sessions. The iShares Semiconductor ETF experienced a decline of 2.6% in premarket trading after a rollover on Tuesday. Chip stocks experienced significant losses to conclude last week, resulting in a 10% drop for the ETF on Friday. The group experienced a modest rebound on Monday, only to see selling pressure resurface thereafter.

The stocks are experiencing downward pressure in anticipation of the SpaceX IPO on Friday, as some traders suggest that investors, particularly smaller retail participants, are liquidating portions of their successful chip stock holdings to accommodate the largest IPO in history within their portfolios. Some contend that the observed weakness is merely a result of profit-taking following an accelerated upward trajectory. The chip ETF has experienced an increase of over 86% this year. Traders are preparing for the release of May’s consumer price index, scheduled for 8:30 a.m. The data will indicate inflation operating at a 4.2% annual rate and an anticipated monthly increase of 0.5%, as per the consensus estimate from economists at Dow Jones. This would represent the inaugural occasion on which the consumer price index, or CPI, has surpassed the 4% threshold since May 2023. It would represent the peak level since April of that year.

In regular trading on Tuesday, semiconductor stocks exerted downward pressure on the S&P 500 and Nasdaq Composite, resulting in declines of 0.26% and 0.97%, respectively. Conversely, the blue-chip Dow increased by 86.10 points, representing a rise of 0.17%. Tuesday’s rout represented a continuation of the pullback observed last week, which was a consequence of a rally propelled by advancements in artificial intelligence. “If we’re discussing the essence of recent developments, it has predominantly been focused on the memory semiconductor sector that has propelled the market.” And “It’s been the real force behind everything, and really it’s run so hard that it feels very toppy at this moment,” said Marta Norton on Tuesday afternoon. “So, does this imply that there’s a certain degree of fundamental deterioration?” she added. “I’m not entirely convinced, but it appears that there is indeed an overstretched sentiment suggesting we may be on the verge of a correction.”