5 Things to Know Before the Stock Market Opens

Stock futures are lower as investors continue to be rattled by uncertainty over the length and impact of the Iran war; crude oil futures are rising despite an announcement yesterday that the IEA would release 400 million barrels from its strategic reserves; the IEA slashed its projection for oil supply growth this year because of the war; Adobe is set to report earnings after the closing bell today amid a rough stretch for the Photoshop maker and other software stocks; and Honda is the latest automaker to take a big financial hit as it shifts focus away from developing electric vehicles for the U.S. market. Here’s what you need to know today.

Stocks Point Lower Amid Concerns About Oil Supply

Stock futures are pointing to a lower open Thursday as the Iran war continues to take its toll on markets. Futures tied to the Dow Jones Industrial Average were down 0.8% recently, while those connected to the S&P 500 and Nasdaq each fell 0.6%. The major indexes ended mostly lower on Thursday, with only the Nasdaq posting a gain of less than 0.1% as Oracle (ORCL) rallied following a solid earnings report. Crude oil futures are extending their gains despite moves from the international community to shore up the global oil supply as experts predict a sizable disruption to the industry (more on that below). Gold futures were little changed at $5,180 an ounce, while bitcoin was also holding steady at around $70,500. The yield on the 10-year Treasury note, which is trading at its highest levels in more than a month, ticked higher to 4.22%

Oil Prices Climb Despite Release of 400M Barrels

Crude oil futures are moving higher again despite Wednesday’s announcement that the International Energy Agency would release 400 million barrels from its strategic reserves, around double its previous largest-ever release in 2022 when Russia invaded Ukraine. West Texas Intermediate futures, the U.S. crude oil benchmark, were recently up 6% at $92.50 per barrel, after surging as high as $96 overnight. Investors appear unconvinced that the IEA’s move will be sufficient if the war in Iran continues to drag on and the Strait of Hormuz remains closed to the millions of barrels of oil that typically move through the channel per day. Crude oil prices have risen nearly 40% since the start of the Iran war in late February.

IEA Sees ‘Largest Supply Disruption’ in History

Along with announcing the massive release from its reserves, the IEA on Thursday issued its latest monthly forecast for the oil industry. The agency said that the war in Iran is causing “the largest supply disruption in the history of the global oil market,” as traffic through the Strait of Hormuz has cratered from 20 million barrels a day to nearly nothing currently. The agency said that oil-producing countries across the Middle East have slashed their production by at least 10 million barrels a day as the blockage causes their storage facilities to fill up. Global oil supply is expected to fall by 8 million barrels per day in March, and the IEA now puts global oil supply growth for the year at about 1.1 million barrels per day, down from 2.4 million it forecast in its February report.

Adobe Set to Release Results Amid Rough Stretch for Software Companies

Adobe (ADBE) is scheduled to release its latest earnings report after the market closes Thursday. The software maker is projected to report adjusted earnings per share of $5.87 on a 10% year-over-year jump in revenue to $6.28 billion for it fiscal first quarter, according to estimates collected by Visible Alpha. Adobe is among the many software stocks that have had a rough start to the year due to concerns over how generative AI could hamper their growth. Adobe shares, which enter Thursday down 22% year-to-date and nearly 40% in the last 12 months, were little changed in premarket trading.

Honda Is Latest Automaker to Project Massive Hit in Shift Away From EVs

Shares of Honda Motor Company (HMC) are sinking this morning after the Japanese automaker became the latest vehicle manufacturer to pivot away from electric vehicles and take a big financial hit while doing so. Honda said Thursday that it expects to take on charges of up to 2.5 trillion Japanese yen ($15.75 billion) in its fiscal year that ends on March 31 as part of the transition. Honda cited the scrapping of EV tax credits in the U.S. and President Trump’s tariffs as factors in the decision, as they would make it much more difficult to sell EVs profitably in the U.S. Several other automakers have made similar announcements in recent months, including Stellantis (STLA), Ford (F), and General Motors (GM). Honda’s U.S.-listed shares were down 6% ahead of the opening bell.

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