Stocks Sink, Oil Jumps as Mideast Tensions Build
Wall Street buckled as reports of Iran’s retaliation for Israel’s attack on its nuclear facilities deepened concerns that the conflict is escalating, with oil jumping and stocks taking a hit.
The S&P 500 lost over 1%, wiping out this week’s advance. Airline and travel companies tumbled, while energy producers and defense shares rose. West Texas Intermediate crude futures surged more than 7%, the most since March 2022. Gold hovered near its all-time high. Treasuries fell as a surge in oil stoked concern about a resurgence in inflation. The dollar edged up.
Iran fired hundreds of missiles in retaliation for Israel’s airstrikes that targeted Tehran’s military and nuclear infrastructure, broadening a conflict that threatens to engulf the region and roil global markets. The Iranian attack, which Tehran said entailed hundreds of ballistic missiles, is the most forceful step yet by Tehran since Israel’s overnight raids killed top Iranian generals and badly damaged key military infrastructure.
“The lasting damage may be crude oil prices,” said Louis Navellier, chief investment officer at Navellier & Associates. “This will certainly do some damage to the inflation statistics if it doesn’t roll back soon.”
The timing of the strike undercuts a risk-on week in which a key measure of inflation came lower than expected while the US and China made progress on trade talks. The surge in oil raises fresh questions about supply-side price pressures, potentially complicating the Federal Reserve’s rate path.
President Donald Trump urged Iran to accept a nuclear deal with Washington to avoid further attacks, which Prime Minister Benjamin Netanyahu vowed would probably happen over the coming days as Israel looks to deal a severe blow to Tehran’s nuclear program.
The S&P 500 fell 1.1% as of 4 p.m. New York time
The Nasdaq 100 fell 1.3%
The Dow Jones Industrial Average fell 1.8%
Source : Bloomberg
