The major U.S. Index futures are currently pointing to a lower open on Thursday, with stocks likely to see further downside following the pullback seen in the previous session.
Technology stocks may lead the markets lower amid a steep drop by shares of Broadcom (AVGO), as reflected by the 1.2 percent slump by the tech-heavy Nasdaq 100 futures.
Shares of Broadcom are plunging by 14.6 percent in pre-market trading even though the chipmaker reported fiscal second quarter earnings that exceeded analyst estimates.
Traders are seemingly disappointed that Broadcom CEO Hock Tan failed to raise the company's full-year forecast of $100 billion in AI chip sales.
"Broadcom may have emerged as a key player in the booming AI infrastructure market, with a particular expertise in the custom chips increasingly being used by the likes of Alphabet and Meta," said AJ Bell head of markets Dan Coatsworth.
He added, "However, just like its rival Nvidia, Broadcom is finding that meeting and even slightly beating forecasts is not enough when the market is holding it to such a high standard."
Overall selling pressure may be somewhat subdued, however, with a steep drop by the price of crude oil helping offset the negative sentiment.
U.S. crude oil futures are plunging by more than 3 percent after the Israeli and Lebanese governments agreed to renew a ceasefire, contingent on Hezbollah cutting off attacks and evacuating all operatives from the area south of the Litani River.
Traders may also be reluctant to make significant moves ahead of the release of the Labor Department's closely watched monthly jobs report on Friday.
With the monthly jobs report looming, the Labor Department released a report this morning showing first-time claims for unemployment benefits in the U.S. unexpectedly increased in the week ended May 30th.
Stocks moved mostly lower over the course of the trading session on Wednesday, giving back ground after trending higher over the past several sessions. The major averages all moved to the downside, with the Dow showing a notable slump.
The Dow showed a downward move going into the end of the day, closing down 620.72 points or 1.2 percent at 50,687.07. The Nasdaq also slid 239.93 points or 0.9 percent to 26,853,98, while the S&P 500 fell 56.10 points or 0.7 percent to 7,553.68.
The pullback on Wall Street came amid uncertainty about the situation in the Middle East, as negotiations between the U.S and Iran continue to drag on.
U.S. Central Command said U.S. forces successfully defeated multiple Iranian ballistic missiles and drones and conducted "self-defense" strikes on Qeshm Island in response to attempted attacks by Iran on Tuesday.
The ongoing military exchanges have contributed to a sharp increase by the price of crude oil, with U.S. crude oil futures surging by more than 2 percent.
However, stocks have recently been able to shrug off concerns about the war amid persistent optimism about strong earnings and resilient economic growth.
"For now, risk appetite remains supported, but with stretched valuations and shifting monetary policy expectations, markets appear increasingly sensitive to any signs that the earnings and growth story may begin to soften," said Daniela Hathorn, Senior Market Analyst at Capital.com.
In U.S. economic news, the Institute for Supply Management released a report showing its reading on U.S. service sector activity increased by more than expected in the month of May.
The ISM said its services PMI rose to 54.5 in May from 53.6 in April, with a reading above 50 indicating growth. Economists had expected the index to tick up to 53.7.
Software stocks showed a substantial move to the downside on the day, with the Dow Jones U.S. Software Index diving by 4 percent.
A decrease by the price of gold also weighed on gold stocks, as reflected by the 3.6 percent plunge by the NYSE Arca Gold Bugs Index.
Telecom, airline and networking stocks also saw significant weakness, while strength among biotechnology, oil and semiconductor stocks helped limit the downside for the markets.
Commodity, Currency Markets
Crude oil futures are plunging $3.30 to $92.72 a barrel after surging $2.26 to $96.02 a barrel on Wednesday. Meanwhile, after slumping $53 to $4,466.90 an ounce in the previous session, gold futures are jumping $60.40 to $4,527.30 an ounce.
On the currency front, the U.S. dollar is trading at 159.83 yen versus the 160.03 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1639 compared to yesterday's $1.1595.
Asia
Asian stocks retreated on Thursday as investors pulled back from technology and semiconductor shares following a weak forecast from U.S. chipmaker Broadcom.
Also, ongoing tensions between Washington and Tehran kept oil prices elevated, raising concerns about inflation and interest rates.
The dollar consolidated recent gains to hover near a two-month high, driven by escalating Middle East tensions after attacks on Kuwait damaged its airport and injured dozens.
Gold traded higher at $4,460 an ounce, while Brent crude futures fell toward $97 a barrel, snapping a three-day rally after Israel and Lebanon agreed to implement a ceasefire.
China's Shanghai Composite Index slid 0.6 percent to 4,057.78 as Middle East tensions flared, threatening a fragile ceasefire and heightening risks to global growth. Hong Kong's Hang Seng Index tumbled 1.5 percent to 25,253.40.
Japanese markets fell sharply while the yen wobbled near the 160-per-dollar level after Bank of Japan Governor Kazuo Ueda indicated a good chance of an interest rate hike this month and Prime Minister Sanae Takaichi warned of intervention in the foreign exchange market at any time.
The Nikkei 225 Index dove 1.4 percent to 67,470.69 after reaching a record high in the previous session. The broader Topix Index settled 1.1 percent lower at 3,951.85.
Seoul stocks slumped as trading resumed following a public holiday. The Kospi Index plunged 1.8 percent to 8,639.41 due to heavy selling by foreign investors. Samsung Electronics, SK Hynix and Hyundai Motor lost 3-4 percent.
Australian markets fell to a one-week low, with investor sentiment dented by the escalating Israel-Lebanon conflict.
Amid persistent geopolitical tensions and rate hike worries, investors ignored positive trade balance and consumer confidence readings.
The benchmark S&P/ASX 200 Index ended down 1.1 percent at 8,686.10, dragged down by heavyweight banks and miners. The broader All Ordinaries Index dropped 1.1 percent to 8,916.90.
Shares of Treasury Wine Estates soared 13.1 percent after the company unveiled a sweeping transformation plan in order to become "a simpler and more focused luxury wine business."
Across the Tasman, New Zealand's benchmark S&P/NZX-50 Index edged down 0.1 percent to 13,101.61, extending losses from the previous session.
Europe
European stocks have moved higher on Thursday as Israel and Lebanon agreed to renew their fragile ceasefire following days of bombardment and drone strikes.
That said, regional gains remained capped by fresh jitters over private credit markets, tariff worries and concerns about inflation and interest rates.
The French CAC 40 Index is up by 1.1 percent and the German DAX Index is up by 0.6 percent, although the U.K.'s FTSE 100 Index has bucked the uptrend and is down by 0.2 percent.
French media conglomerate Vivendi slumped 4.6 percent, a day after losing its fight against EU antitrust regulators.
Spirits group Remy Cointreau jumped 11 percent after its Chief Executive Officer Franck Marilly unveiled an ambitious three-year transformational plan.
Universal Music Group shares plunged 5.6 percent in Amsterdam after Bil Ackman's Pershing Square offloaded its remaining stake in the world's biggest music company.
Pharming Group rose about 2 percent after the U.S. FDA accepted its resubmitted sNDA for Joenja to treat children aged 4-11 years with APDS.
Online trading and investment company CMC Markets soared 13 percent in London after raising its FY27 net operating income outlook.
Dutch technology company Royal Philips gained 1 percent after it announced a seven-year strategic alliance with WellSpan Health.
U.S. Economic News
First-time claims for unemployment benefits in the U.S. unexpectedly increased in the week ended May 30th, according to a report released by the Labor Department on Thursday.
The report said initial jobless claims climbed to 225,000, an increase of 13,000 from the previous week's revised level of 212,000.
Economists had expected jobless claims to edge down to 212,000 from the 215,000 originally reported for the previous month.
With the unexpected increase, jobless claims reached their highest level since hitting 230,000 in the week ended February 7th.
Federal Reserve Vice Chair for Supervision Michelle Bowman is scheduled to testify before a House Financial Services Committee hearing on oversight of prudential regulators at 10 am ET.
At 1 pm ET, Kansas City Federal Reserve President Jeffrey Schmid is due to participate in a moderated fireside chat before the Federal Reserve Bank of Kansas City Economic Forum.
San Francisco Federal Reserve President Mary Daly is scheduled to participate in a panel before the Bloomberg Technology Summit at 1:10 pm ET.
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May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.