Stock futures fell early Monday traders weighed the latest events in the Middle East and braced for a slew of corporate earnings reports due out later in the week.

Dow Jones Industrial Average futures slipped 229 points, or 0.43%, while S&P 500 futures lost 0.58%. Nasdaq-100 futures were down 1.37%.

Iran and the U.S. again traded airstrikes over the weekend, with Tehran targeting U.S. facilities in multiple Gulf countries and declaring the Strait of Hormuz closed. However, President Donald Trump disputed the claim on Sunday, saying the key waterway was open to commercial traffic.

Trump on Saturday ordered airstrikes against Iran after an attack by Iran on a commercial ship transiting the strait.

Crude prices were up in early trading as tensions escalated. Brent futures rose 3.7% to $78.86 per barrel. West Texas Intermediate futures advanced more than 3% as well to $74.05.

In Asia, markets mostly ended lower South Korea’s Kospi fell almost 9% lower, dragged by index heavyweight and chip giant SK Hynix that sunk over 15%. Japan’s Nikkei 225 lost 1.92%. China’s CSI 300 declined 1.79%.

The pan-European Stoxx 600 was 0.21% lower by 8:30 a.m. in London (3:30 a.m. E.T.), as tensions in the Middle East dragged the continent’s sectors into mostly negative territory. Oil and gas names led gains, while European semiconductor stocks followed Asian peers into the red.

“The Strait closure will hang over the market with a risk-off tone,” wrote Ben Emons, founder of Fed Watch Advisors. “Still, unless there is a serious prospect of a closure in the coming months, which could cause major global energy shortages … the focus next week will (also) be on CPI, Warsh, and bank earnings.”

Major U.S. banks — including JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America, Citigroup and Wells Fargo — are among the 28 S&P 500 companies set to report earnings this week. Quarterly results from Netflix, Johnson & Johnson and UnitedHealth are also on deck.

Expectations for the season are high. On average, analysts estimate that second-quarter S&P 500 profits grew by more than 23% year over year, per FactSet.

One sector to watch, according to Raymond James CIO Larry Adam, is tech. Specifically, whether AI can keep boosting earnings in the sector.

“Despite concerns that hyperscalers may start to moderate AI-related capital spending, we expect capex plans to be reaffirmed and to rise through 2028. Why? Because there is tangible evidence that businesses benefit from AI adoption. Mentions of AI across all 11 sectors are up 98% YoY, reaching new highs,” Adam wrote to clients.

The June CPI report is also due out Tuesday morning.