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Futures down: Dow 1.17%, S&P 500 1.17%, Nasdaq 1.41%
June 13 (Reuters) - U.S. stock index futures dropped on
Friday after Israel's military strike on Iran escalated tensions
in the oil-rich Middle East and battered risk sentiment across
global markets.
Israel's widescale strikes against Iran's nuclear facilities
were aimed at preventing Tehran from building an atomic weapon.
Iran has promised a harsh response and retaliated by launching
100 drones.
The escalation of tensions in the Middle East - a major
oil-producing region - sent oil prices surging more than 6% and
U.S. energy stocks rose in tandem, with Chevron ( CVX ) and
Exxon advancing nearly 3% in premarket trading.
The strikes come just days ahead of a planned sixth round of
nuclear talks between Iran and the United States. Tensions had
been building as U.S. President Donald Trump's efforts to reach
a nuclear deal with Iran appeared to be deadlocked.
U.S. Secretary of State Marco Rubio called the Israeli
offensive a "unilateral action" and said Washington was not
involved.
At 04:32 a.m. ET, Dow E-minis were down 505 points,
or 1.17%, S&P 500 E-minis were down 70.5 points, or
1.17%, and Nasdaq 100 E-minis were down 309.25 points,
or 1.41%.
A 1.6% slump in Russell futures pointed to
sharp declines for domestically focused stocks.
Airline stocks dipped as the surge in crude prices raised
concerns about higher fuel costs. Delta Air Lines ( DAL ) was
down 3.9%, United Airlines dropped 4.8%, Southwest
Airlines ( LUV ) lost 2.5% and American Airlines ( AAL )
declined 3.9%.
Defense stocks rose, with Lockheed Martin ( LMT ) up 4.7%,
RTX Corporation ( RTX ) up 5.5%, Northrop Grumman ( NOC ) up
4.2% and L3harris Technologies ( LHX ) up 4.3%.
The S&P 500 still remains just 1.8% below its record
high reached earlier this year, following stellar monthly gains
in May driven by upbeat corporate earnings and a softening in
Trump's trade stance.
The tech-heavy Nasdaq is about 2.8% off its record
closing high reached in December last year.
Investors are now focused on the Federal Reserve's meeting
scheduled next week where policymakers are expected to keep
interest rates unchanged.
(Reporting by Kanchana Chakravarty in Bengaluru; Editin by
Devika Syamnath)