Update before market open

By Ragini Mathur and Utkarsh Hathi

May 21 (Reuters) - Wall Street's main indexes were set to open lower on Thursday as oil prices surged following a Reuters report that Iran's Supreme ‌Leader Ayatollah Mojtaba Khamenei ordered the country's near-weapons-grade uranium not be sent abroad, dimming hopes for progress in talks between Washington and Tehran.

Brent crude futures LCOc1 jumped 1.7% to $106.82 a barrel. O/R

Oil had traded lower earlier in the session, extending losses from Wednesday, on optimism that diplomatic efforts could ease tensions. But the Reuters report later suggested Iran was hardening its position on one of Washington's key demands, reviving concerns about a prolonged disruption around the Strait of Hormuz, a critical route for global oil supplies.

The yield on the benchmark U.S. 10-year Treasury note rose to 4.611%, resuming its recent climb after snapping a three-day run of gains on Wednesday. A lack of meaningful progress towards reopening the strait has added to inflation concerns, pushing up yields and weighing on equities.

Investors also parsed a fresh batch of corporate earnings. Walmart WMT.O dipped 2.9% in premarket trading after the largest retailer globally maintained annual targets and forecast second-quarter profit below estimates against a strained U.S. economic backdrop.

"The guidance (from Walmart) is what has caused investors to be concerned that finally we are seeing the effects of high oil prices and inflation on retail expectations. So that's what's putting some pressure on stocks today," said Sam Stovall, chief investment strategist, CFRA Research.

Shares of Nvidia NVDA.O, the world's most valuable company, edged down 0.8%, even after the AI heavyweight forecast second-quarter revenue above Wall Street estimates and announced an $80 billion share repurchase program.

Its stock has jumped almost 20% so far this year but the pace of growth has slowed as investors believe Nvidia will face tougher competition, not only from Big Tech but also chip rivals including Intel INTC.O and Advanced Micro Devices AMD.O.

At 8:54 a.m. ET, Dow E-minis YMcv1 were down 153 points, or 0.31%, and S&P 500 E-minis EScv1 were down 27.5 points, or 0.37%. Nasdaq 100 E-minis NQcv1 were down 166.75 points, or 0.57%.

Investors also monitored SpaceX after the company unveiled its IPO filing on Wednesday, giving the market its first glimpse into how much billionaire Elon Musk is spending on AI as he bets on transforming the rocket maker into a broader AI-led business.

On the economic front, the number of Americans filing new applications for unemployment benefits fell last week, pointing to continued labor-market resilience and giving the Federal Reserve room to keep its focus on inflation risks.

Business activity surveys due at 9:45 a.m. ET could provide further clues on the health of the U.S. economy.

IBM IBM.N climbed 5.8% as the Trump administration is awarding grants to a handful of companies, including IBM, that are focussed on quantum computing in exchange for stakes in some of them.

GlobalFoundries GFS.O was up 13.4%, D-Wave Quantum QBTS.N jumped 14.5%, Rigetti Computing RGTI.O gained 13.2% and Infleqtion INFQ.N added 21.5%.

Intuit INTU.O shares fell 15.9% after the software maker lowered the annual revenue forecast for its tax-filing software, TurboTax, and said it would cut 17% of its full-time workforce.