May 5 (Reuters) - Wall Street's main indexes were on track to recover on Tuesday as oil prices fell despite renewed Middle East tensions that threatened to upend a fragile truce after the U.S. and Iran exchanged fire in the Gulf.
Markets are being pulled in opposite directions by the conflict and the rapidly shifting situation on the ground. While some investors believe worst-case scenarios are still not fully priced in, others argue the focus should remain on underlying economic fundamentals and strong earnings.
Moves have been volatile as a result, with equities vulnerable to sudden reversals as new and often conflicting headlines emerge.
At 8:26 a.m. ET, Dow E-minis rose 221 points, or 0.41%, S&P 500 E-minis added 35.25 points, or 0.49%, and Nasdaq 100 E-minis gained 213.75 points, or 0.77%.
Brent crude futures lost 2.1% but were still trading above $110 a barrel.
"Earnings have been better than expected, which has been great, considering the valuations. You need the earnings to support where you are," said Joe Saluzzi, co-head of equity trading at Themis Trading.
"There are certainly big issues out there that I think the market is overlooking and that might come back to haunt us."
Crucially, the vital Strait of Hormuz oil shipping route remains disrupted.
Being a net energy exporter, the U.S. has held up better than several other economies, with the benchmark S&P 500 (.SPX), and the Nasdaq Composite (.IXIC), hitting record highs in recent days.
However, "even U.S. equities won't be insulated" if the Strait of Hormuz does not open, BlackRock Investment Institute analysts led by Global Chief Investment Strategist Wei Li said in a note.
Meanwhile, grain trader Archer-Daniels-Midland (ADM.N), rose 1% in premarket trading after reporting better-than-expected first-quarter profit on higher margins.
DuPont (DD.N), gained 1.8% after the industrial materials maker lifted its annual profit forecast.
Shares of Pinterest (PINS.N), jumped 17.7% after the image-sharing platform forecast second-quarter revenue above analysts' estimates.
Intel (INTC.O), rose 3.8% after Bloomberg News reported Apple (AAPL.O), had held exploratory discussions about using Intel (INTC.O), and Samsung Electronics (005930.KS), to produce the main processors for its devices.
Investors now await the U.S. Labor Department's latest Job Openings and Labor Turnover Survey, or JOLTS report, due for release at 10 a.m. ET.
Reporting by Niket Nishant and Utkarsh Hathi in Bengaluru; Editing by Pooja Desai
