It's Friday, and the stock market is looking to shake off Thursday's gloom. Futures for the major indices are all in the green, with the Dow up 0.35%, the S&P 500 gaining 0.30%, and the Nasdaq 100 leading with a 0.46% advance. The small-cap Russell 2000 is also popping 0.54% higher.

But the big story this morning isn't just about earnings. It's about Iran. Treasury Secretary Scott Bessent has come out swinging, warning that the U.S. will impose "the toughest sanctions in history" on Iran. This follows President Trump's earlier threats of "Economic Warfare" and "tremendous" consequences for any country that helps Tehran. The Middle East tensions are clearly keeping traders on edge, but so far, the market is taking the news in stride.

On the bond front, the 10-year Treasury yield is sitting at 4.69%, while the two-year is at 4.18%. And here's a number that might raise some eyebrows: the CME Group's FedWatch tool shows a 34.6% probability that the Federal Reserve will actually hike interest rates at its September meeting. Yes, you read that right. Hiking, not cutting.

Let's get to the premarket movers, because there's a lot to unpack.

Stocks In Focus

Ross Stores

First up, Ross Stores (NASDAQ:ROST) is having a moment. The off-price retailer jumped 9.04% in premarket trading after reporting better-than-expected second-quarter financial results after Thursday's close. The company seems to be bucking the trend of cautious consumers, and investors are rewarding it. According to market data, ROST maintains a strong price trend across short, long, and medium terms, with a solid quality score.

Flowers Foods

On the flip side, Flowers Foods (NYSE:FLO) is wilting. The bakery company fell 4.37% after reporting downbeat earnings for the second quarter. Earnings came in at 21 cents per share, missing the analyst consensus of 23 cents, and sales of $1.193 billion also fell short of the expected $1.228 billion. It's a classic miss on both fronts, and the market is not happy. The stock's price trend is weak across all timeframes, and its growth score is poor, according to market data.

OSI Systems

OSI Systems (NASDAQ:OSIS) is taking a big hit, dropping 14.48% after reporting mixed fourth-quarter results and issuing weak FY27 sales guidance. The company's board did approve an additional authorization to repurchase 1 million shares, bringing the total remaining authorization to 1,078,731 shares, but that's not enough to cushion the fall. The stock has a strong short-term price trend but weak medium and long-term trends, with a moderate value score.

Strategy

Now, for the crypto crowd, Strategy (NASDAQ:MSTR) is soaring. The stock jumped 10.57% after President Trump urged Congress to pass the Clarity Act and said that CFTC Chair Michael Selig is working to bring Hyperliquid to the U.S. That's a big deal for the crypto world, and MSTR is riding the wave. The stock has a weak long and medium-term price trend but a strong short-term trend, according to market data.

Advance Auto Parts

Advance Auto Parts (NYSE:AAP) is up 0.57% in premarket, but that's after a brutal 24.55% decline on Thursday. The company reaffirmed its full-year 2026 sales, adjusted operating margin, capital expenditure, and free cash flow guidance, but revised its adjusted EPS guidance to reflect higher interest income. It seems investors are still digesting the news. The stock has a weak short and medium-term price trend but a strong long-term trend, with a poor quality score.

Cues From Last Session

Thursday was a rough day on Wall Street. Most S&P 500 sectors finished in the red, with health care, consumer discretionary, and consumer staples taking the biggest hits. Energy and real estate managed to buck the trend and close higher. The Dow fell 1.32% to 52,759.21, the S&P 500 dropped 0.87% to 7,641.16, the Nasdaq Composite lost 1.00% to 26,067.17, and the Russell 2000 slipped 1.34% to 2,992.43.

Insights From Analysts

Tony Miano, Global Fixed Income Analyst at Wells Fargo Investment Institute, has some thoughts on where the economy is headed. He believes the broader U.S. economy can withstand modest interest rate hikes thanks to underlying stability. He views recent weak retail sales and slower job growth as "more likely signs of a pause than of growing economic weakness," and maintains that "economic growth remains resilient" despite higher borrowing costs.

But Miano also notes that "inflation remains elevated," which is why his team projects "the Fed delivering two rate hikes over the coming year." That's a bold call, but he's sticking with it.

For investors, Miano warns that rising interest rate risks could make the backdrop "unfavorable for long-term bonds." His advice? Don't reach for long-term maturities. Instead, he favors shorter-term fixed income assets. Short-term investment-grade corporate bonds, he explains, "continue to offer a compelling combination of yield, lower sensitivity to interest-rate changes, and less exposure to the risks facing longer-term bonds" in this volatile environment.

Upcoming Economic Data

Here's what to watch on Friday. August's S&P flash U.S. manufacturing PMI and flash U.S. services PMI data will be released at 9:45 a.m. ET. These numbers will give us a fresh look at how the economy is holding up.

Commodities, Crypto, And Global Equity Markets

Oil is slipping. WTI crude futures are trading lower by 0.86%, hovering around $86.08 per barrel. Gold, on the other hand, is shining, up 1.38% to around $4,581.57 per ounce. The U.S. Dollar Index is down 0.24% at 98.6560.

Bitcoin (CRYPTO: BTC) is having a great day, trading 9.4% higher at $78,459.21 per coin over the last 24 hours. That's a nice bounce.

Globally, Asian markets were mixed on Friday. Hong Kong's Hang Seng, China's CSI 300, and South Korea's Kospi all rose, while Australia's ASX 200, India's Nifty 50, and Japan's Nikkei 225 fell. European markets are mostly higher in early trading.

So, a lot to digest. But the takeaway is that investors are feeling a bit more optimistic today, even with the geopolitical tensions and the possibility of more rate hikes. Let's see how the session plays out.