Dow futures are experiencing a slight decline as the final trading day of the week approaches, with investors expressing concerns regarding the future direction of the artificial intelligence boom. Netflix issues a financial forecast that falls short of expectations, resulting in a significant decline in shares of the streaming giant. Meanwhile, the U.S. and Iran engage in reciprocal strikes, raising concerns regarding the stability of the Strait of Hormuz.

Dow Futures associated with the primary U.S. stock indices experienced a decline on Friday, indicating a continuation of the losses observed in the previous session. By 02:57, the Dow futures contract had declined by 336 points, representing a decrease of 0.6%. Meanwhile, S&P 500 futures experienced a drop of 66 points, equating to a 0.9% reduction, and Nasdaq 100 futures saw a retreat of 488 points, or 1.7%. The primary indices on Wall Street experienced a decline on Thursday. The blue-chip Dow Jones Industrial Average slid by 0.2%, while the benchmark S&P 500 and tech-heavy Nasdaq Composite declined by 0.5% and 1.47%, respectively. While tensions in the Middle East persist as a backdrop for equities, the primary influence on sentiment has been a “deteriorating” narrative surrounding AI, analysts noted in a report. Tech shares were notably among the largest underperformers, especially those involved in the production of memory chips that are essential for advanced AI models. “[T]he list of things worrying people will sound familiar to anyone following the space: the absence of free cash flow for hyperscalers/neoclouds, costs that seem to scale higher with revenue, the reliance on capital markets […] to fund capex […], the huge pipeline of debt/equity supply that’s washing over markets, the increasingly poor financial/fundamental prospects for bleeding edge frontier labs […], and questions about data center overcapacity,” the strategists wrote.

Netflix experienced a decline of over 8% in after-hours trading following the release of its third-quarter revenue and earnings guidance, which fell short of Wall Street expectations. This development has sparked renewed apprehension regarding the company’s growth trajectory. The company has projected third-quarter earnings per share at $0.82, which falls short of analysts’ expectations of $0.84. Additionally, revenue is anticipated to be $12.86 billion, also below the consensus estimate of $13.0 billion. In a letter to shareholders, Netflix stated that its financial performance “remains solid,” further noting that it is “on track to meet our objectives for the year.” Netflix announced that it will alter the frequency of its viewing-hours report, opting to publish this data on an annual basis rather than biannually, beginning in January 2027. This change is part of a strategic shift to redirect investors’ attention towards its fundamental financial metrics, such as revenue and operating profit. The company ceased the disclosure of quarterly subscriber figures in 2025.

Traders will have the opportunity to analyse additional corporate earnings on Friday. The Travellers Companies and Truist Financial Corporation are both scheduled to announce their results prior to the opening bell on Wall Street, alongside Fifth Third Bancorp and Regions Financial Corporation. Investors have been closely monitoring how major companies are navigating significant challenges, including emerging AI concerns and oil supply disruptions stemming from the U.S. conflict with Iran. Nevertheless, the analysts noted that the “macro commentary from management teams pretty much across the board.” Recent economic figures seem to support this observation: core retail sales have remained robust, jobless claims have decreased, and manufacturing activity has experienced a notable increase in the U.S. Northeast. Earlier this week, consumer price growth decelerated more than anticipated in June, while producer prices experienced an unexpected decline.

On Friday, Iran initiated a new series of air assaults on U.S. installations in the Middle East, following the targeting of Iranian military sites by American forces. U.S. Central Command announced on Thursday evening the completion of a sixth consecutive night of strikes targeting Iran. CENTCOM stated that the attacks were intended to further diminish Iranian military capabilities and “hold Iran accountable” for assaults on commercial shipping. Iranian media also reported that the most recent U.S. attacks targeted certain civilian infrastructure, including five bridges and a railway station. All of this has rendered the fate of the Strait of Hormuz shrouded in ambiguity. Tanker traffic through the narrow waterway has been disrupted once again, undermining expectations that a tenuous ceasefire agreement established just a few weeks ago would facilitate the resumption of flows. Oil prices experienced an uptick on Friday. Brent crude futures, the global oil benchmark, experienced an increase of 0.7%, reaching $84.81 per barrel, while U.S. West Texas Intermediate crude futures saw a rise of 1.0%, settling at $79.76 per barrel.

A Starship rocket manufactured by SpaceX aborted a scheduled flight test in Texas just moments prior to liftoff on Thursday, due to a malfunction in the ignition of several of its 33 engines. The rocket’s engines ignited but were subsequently shut down shortly thereafter, according to a report. In a recent social media post, CEO Elon Musk refrained from disclosing the specific number of engines that failed to ignite, yet indicated that SpaceX may consider another launch attempt as early as next week. Shares of SpaceX, which went public in a record-smashing deal in June, experienced a decline of over 4% during extended hours trading following the news. On Thursday, the stock concluded at $131.11, marking the inaugural instance of closing beneath its $135 IPO price.