S&P 500 Weakens, Iran Risk Looms
US stocks weakened in early trading on Wednesday, pressured by rising oil prices and investor caution ahead of the release of earnings reports by several major companies.
The S&P 500 index fell 0.2%, while the Nasdaq Composite weakened 0.5%. Meanwhile, the Dow Jones Industrial Average still managed to gain 88 points, or around 0.2%.
The main pressure came from the surge in oil prices. Brent rose 2% to above US$93 per barrel and briefly reached US$95, its highest level in more than a month. Meanwhile, WTI also rose 2% to above US$86 per barrel.
Oil prices strengthened after the US launched its 11th attack on Iran. US Secretary of State Marco Rubio said Iran was not serious about peace talks and emphasized that US forces would continue to protect shipping lanes in the Strait of Hormuz.
Impacting the market, the rising oil prices have raised investor concerns about rising consumer inflation. This situation could boost expectations for a Fed rate hike, with the market pricing in a 24% chance of a hike this month and a 70% chance of at least a 25 basis point hike in September. If oil continues to rise, technology stocks and risk assets could potentially come under further pressure. (arl)
Source: Newsmaker.id
