Stock futures fell Thursday, putting the S&P 500 and Dow Jones Industrial Average on track to pull back further from record levels. Futures tied to the 30-stock Dow shed 163 points, or 0.3%. S&P 500 futures and Nasdaq 100 futures lost 0.2% and 0.3%, respectively. The S&P 500 and Dow ended Wednesday’s session in the red after touching fresh all-time highs. Defense stocks rallied Thursday after Trump called for a $1.5 trillion defense budget in 2027. Northrop Grumman gained 6.8% in premarket trade, Lockheed Martin was last seen 6.7% higher, RTX advanced 5.4%, and Kratos Defense was up 6.6%. Markets have largely shrugged off global geopolitical risks, but growing tensions could test the resilience of stocks as the new year begins. “Geopolitical headlines tend to be market moving in very short periods of time … but they tend to get priced in and then the markets go back to watching the things that are more drivers of price action. For example, profits, margins, valuation and other metrics,” Anne Walsh, CIO of Guggenheim Partners told CNBC’s “Power Lunch” on Wednesday. “What ends up happening is that ‘buy the dip’ mentality returns and these very limited opportunities exist to reposition portfolios.” “Being diversified and being ready is probably the best insurance, if you will, in terms of protecting portfolios and also being able to take advantage of opportunities,” Walsh said, adding that the stock market fundamentals remain “fairly good” with normalizing valuations and expected rate cuts ahead this year from the Federal Reserve. The benchmark 10-year Treasury yield moved lower on Wednesday as investors digested weaker-than-expected ADP jobs data and continued to monitor geopolitical uncertainty. The yield on the 10-year Treasury was down more than 3 basis points to 4.142%. The 2-year Treasury note was lower by less than a basis point at 3.469%. Meanwhile, the 30-year bond yield declined more than 4 basis points to 4.822%. Asia-Pacific markets mostly fell Thursday after Wall Street closed lower amid rising geopolitical tensions and comments from U.S. President Donald Trump. Japan’s benchmark Nikkei 225 index fell 1.63%, weighed down by basic materials and technology stocks. The broader Topix index retreated 0.77%. South Korea’s Kospi settled slightly above the flatline at 4,552.37, while the small-cap Kosdaq retreated 0.35%. Australia’s S&P/ASX 200 closed 0.29% higher at 8,720.8. Hong Kong’s Hang Seng Index declined 1.59%. The mainland’s CSI 300 fell 1.04%. Oil ‍prices rose on Thursday after ‍two days of ‍declines as investors assessed Venezuela developments and reports on progress of proposed U.S. sanctions legislation against countries doing business with Russia. Brent crude futures were up 59 ‌cents, ‌or 0.98%, at $60.55 a barrel. U.S. West Texas Intermediate crude gained 58 cents, or 1%, to $56.57. Higher prices are led by the U.S. President allowing the Russia sanctions bill to advance, as it raises fears ⁠of further disruption to Russian oil exports, said PVM analyst Tamas Varga. Gold prices fell on Thursday as investors braced for ‍futures selling tied to ‍a commodity index reshuffle, ‍with a stronger U.S. dollar adding pressure by making the metal costlier for overseas buyers. Spot gold fell 0.6% to $4,427.48 per ounce. U.S. gold futures ‌for ‌February delivery fell 0.6% to $4,435.40. “Gold and silver remain ​under pressure as the annual commodity-index rebalancing gets underway. Over the next five days, COMEX futures could see selling in the region of $6 to $7 billion in each metal,” said Ole Hansen, head of ⁠commodity strategy at Saxo Bank.