US stock market today: Dow, S&P 500, Nasdaq futures edge lower as Fed rate hike fears return

US stock futures traded modestly lower on Wednesday, 1 July, as investors awaited a fresh batch of economic data and speeches from major central bankers, including Federal Reserve Chair Kevin Warsh, before making fresh bets.

Futures tied to the Dow Jones Industrial Average fell 105 points, or 0.2%, while S&P 500 futures slipped 0.2% and Nasdaq 100 futures declined 0.4%. In the previous session, all three major US indices ended higher, capping off a strong first half of the year.

The S&P 500 gained 9.55% during the first six months of 2026, while the Nasdaq 100 outperformed with an 20% advance. The Dow climbed of 8.9%, marking its best first-half performance since 2021.

After aggressively increasing exposure to chip and memory stocks in the first half of 2026—some of which delivered gains of as much as 300%—investors are now seeking greater clarity on whether the AI-driven rally has further room to run, particularly amid growing expectations of a US Federal Reserve interest rate hike.

US Federal Reserve Chair Kevin Warsh is scheduled to make his first public appearance overseas since taking charge of the Fed. Warsh will speak alongside central bank chiefs from Europe and the UK at the ECB Forum in Sintra, Portugal, according to Bloomberg.

His hawkish remarks last month, in which he reaffirmed the Fed's commitment to restoring price stability, pushed the US dollar and short-term Treasury yields higher.

Meanwhile, traders in the Fed funds market have increased bets that the Fed could begin raising interest rates as early as July, a scenario that will largely depend on upcoming economic data.

Economic data released on Tuesday showed that US job openings remained largely unchanged in May, signalling resilient labour demand, while consumer confidence improved in June, supported by lower gasoline prices despite lingering concerns over the labour market.

In the Middle East, geopolitical uncertainty remained in focus after Iran reportedly said on Tuesday that it would not meet senior US envoys who had travelled to the region following the latest escalation in hostilities.

The development came after Iranian officials indicated that Tehran and Washington still need to finalise the terms of the interim peace agreement signed last month before moving on to more contentious issues, including Iran's nuclear programme, Reuters reported.

Crude oil slips as Strait of Hormuz shipping recovers

Crude oil prices edged lower as shipping activity through the Strait of Hormuz continued to recover. Brent crude slipped below $72 a barrel after falling nearly one-third over the past three months, while West Texas Intermediate (WTI) traded near $68 a barrel.

Oil tanker traffic has gradually picked up since the US and Iran exchanged strikes over the weekend, although vessel movements remain below pre-conflict levels.

Meanwhile, Goldman Sachs said the global oil market is likely to return to an oversupply situation as the impact of the Iran conflict fades and shipping through the Strait of Hormuz normalises.

However, risks remain. Iran has reiterated its intention to retain control over maritime traffic through the strategic waterway, highlighting that key issues—including its nuclear programme and the conflict in Lebanon—remain unresolved and could complicate negotiations during the 60-day ceasefire period.

(With inputs from Bloomberg and Reuters)