U.S. stock futures are subdued, with markets weighing hopes for a sustained ceasefire between Israel and Iran as well as fresh interest rate comments from Federal Reserve Chair Jerome Powell. Oil prices rise, but stay around multi-week lows, as a stop to the fighting in the Middle East appeared to remain in effect. Elsewhere, economic uncertainty clouds the financial outlook from delivery group FedEx (NYSE:FDX).

1. Futures muted

U.S. stock futures hovered above the flatline on Wednesday, as investors gauged a fragile ceasefire between Israel and Iran and assessed commentary from Powell.

By 03:40 ET (07:40 GMT), the Dow futures contract had inched up by 33 points, or 0.1%, and S&P 500 futures were broadly unchanged, while Nasdaq 100 futures edged up by 19 points, or 0.1%.

The main averages on Wall Street rose in the prior session, buoyed by expectations that, despite some heated rhetoric and an exchange of strikes, a formal halt to hostilities in the multi-day Israel-Iran conflict would hold.

Traders were also noting a modest shift in a dovish direction from Fed policymakers, although Powell used the first day of his testimony to Congress this week to underscore the central bank’s recent wait-and-see stance to future interest rate changes.

Still, markets are cautiously eyeing the looming expiration of a delay to sweeping U.S. "reciprocal" tariffs in early July, with the White House racing to secure deals with dozens of individual countries.

"Trade is the most acute risk facing markets, but investors are maintaining a very calm attitude toward this topic, confident that the ultimate impact won’t be much worse than the 10% baseline tariff," analysts at Vital Knowledge said in a note to clients.

2. Israel-Iran ceasefire holds

The Israel-Iran ceasefire brokered by President Donald Trump appeared to still be in place on Wednesday, one day after the regional rivals said they had ended an air war after 12 days.

Steve Witkoff, Trump’s envoy to the Middle East, said late on Tuesday that negotiations with Iran were "promising," adding that Washington is continuing to hope for a long-term peace with Tehran.

"Now it’s for us to sit down with the Iranians and get to a comprehensive peace agreement, and I am very confident that we are going to achieve that," Witkoff told Fox News’ "The Ingraham Angle" show.

Earlier on Tuesday, Trump announced the start of the ceasefire, but lashed out at both Israel and Iran for carrying on with attacks that seemed to have already been planned before the agreement was revealed. Trump previously came in on the side of Israel, ordering air strikes against Iranian nuclear facilities over the weekend.

Trump claimed that the strikes had "obliterated" the sites, but U.S. intelligence agencies have found that Iran’s enriched uranium stocks had not been eradicated and the nation’s mostly-underground nuclear program may have only been set back by a couple of months, according to media reports.

3. Oil ticks higher

Oil prices edged up, with traders keeping tabs on the resilience of the Israel-Iran ceasefire.

Yet crude remained around multi-week lows, weighed down by expectations that an easing in Middle East tensions will avert disruption to oil supply flows out of the oil-rich region. Worries had particularly swirled around whether Iran’s response to Israeli and U.S. strikes would be to stem shipping through the Strait of Hormuz, a key tanker thoroughfare located along Iran’s southern coast.

Brent crude had increased by 1.7% to $67.30 per barrel by 03:40 ET, while U.S. West Texas Intermediate crude futures had gained 1.8% to $65.53 a barrel.

On Tuesday, Brent settled at its lowest mark since June 10 and WTI since June 5. Both dates were prior to Israel’s surprise strike on Iranian military and nuclear facilities earlier this month.

4. Day two of Powell testimony to Congress

Attention now turns to Washington, where Fed Chair Jerome Powell is due to deliver his second day of testimony on Capitol Hill, this time to a Senate committee.

In prepared remarks released on Tuesday, Powell indicated that the central bank is prepared to maintain current interest rates while monitoring economic developments.

He described the U.S. economy as being in a "solid position" despite elevated uncertainty, with the unemployment rate remaining low at 4.2% in May. He noted that labor market conditions are "broadly in balance and consistent with maximum employment."

The Fed Chair acknowledged that inflation has "eased significantly" from its mid-2022 peaks but remains above the central bank’s 2% target. Total personal consumption expenditures prices rose 2.3% for the 12 months ending in May, while core PCE prices, excluding food and energy, increased 2.6%.

Facing a grilling from House lawmakers over why the Fed is not moving quickly to slash rates, an often-repeated demand from Trump, Powell said officials are wary that price gains could accelerate again soon due to the implementation of elevated U.S. tariffs.

5. FedEx earnings

Shares in FedEx sank in extended hours trading after the delivery giant and economic bellwether unveiled a current-quarter profit forecast that missed analysts’ expectations.

Along with United Parcel Service (NYSE:UPS), FedEx’s results offer a possible glimpse into the state of the wider economy.

Trump’s aggressive trade agenda -- especially towards top global exporter China -- has recently sparked a wave of uncertainty around growth, weighing on consumer confidence and leading many businesses to rein in spending plans until more clarity emerges.

Speaking in an earnings webcast, FedEx CEO Raj Subramaniam said that the global demand environment is "volatile." Executives added that Trump’s decision to scrap duty-free status for low-cost shipments from China-linked retailers like Shein and Temu have also dented the firm’s returns.

Memphis-based FedEx said it expects to deliver fiscal first-quarter adjusted profit of $3.40 to $4 a share, short of Wall Street projections of $4.06, according to LSEG data cited by Reuters. The company did not provide full-year earnings and revenue guidance as well, citing the murky operating backdrop.