Trading was choppy for much of the session as investors engaged in a fierce battle over fuel supply concerns. Iran continued to attack ships in the blocked Strait of Hormuz, but OPEC reassured markets that Saudi Arabia had increased production and the International Energy Agency (IEA) agreed to release 400 million barrels of oil from its strategic reserves.
The Dow posted the biggest percentage drop among the three major U.S. equity indexes, while chipmakers lifted the tech-heavy Nasdaq to modest, late-session gains.
The Labor Department’s Consumer Price Index (CPI) indicated that inflation remained modest last month, in line with analysts’ expectations.
Annual CPI growth is now within half a percentage point of the US Federal Reserve’s 2% target. Still, markets ignored the report because it predicted a war with Iran, which has pushed up crude oil prices and stoked inflation. The inflation shocks came after Iran’s military command said the world should prepare for oil prices to hit $200 a barrel, more than double their current levels.
“In such an uncertain environment, markets and investors are hungry for any signal in one direction or another,” said Matthew Cater, managing partner of Cater Group, an asset management firm in Lennox, Massachusetts. “There are false or inaccurate reports, and the markets move on that kind of news.”
“It all depends on the consumer, and how the shock of a sustained increase in oil prices affects the consumer’s pocketbook and their spending habits,” Kator added. The Fed is widely expected to hold its key interest rate on hold at its next policy meeting, while policymakers are likely to weigh the possibility of raising rates against signs of a softening job market, a combination that raises concerns about a possible slowdown.
“I think the word transition might come back,” said Chuck Carlson, chief executive officer of Horizon Investment Services in Hammond, Indiana. “I think they’re probably more concerned about jobs than they are about inflation right now, despite the increase in oil.”
The Dow Jones industrial average fell 289.24 points, or 0.61%, to 47,417.27, the S&P 500 lost 5.68 points, or 0.08%, to 6,775.80 and the Nasdaq Composite rose 19,03%. 22,716.14. Among the S&P 500’s 11 largest sectors, consumer staples saw the biggest percentage decline, while energy was brighter, with crude prices rising 2.5%.
First-month WTI and Brent crude futures rose 4.6% and 4.8%, respectively. Tech was also slightly higher, with a boost from Oracle, which provided better-than-expected revenue guidance as the artificial intelligence-related spending boom will extend through 2027. Its shares rose 9.2%. JPMorgan Chase has targeted the value of some loans held by private credit groups and is tightening its lending to the sector, a report says. Iris Management fell 4.8% and Apollo Global fell 1.9%. Campbell’s shares fell 7.1% after the packaged food company cut its annual forecasts and warned of increased pressure from US tariffs in the second half. Defense firm AeroVironment fell 6.3% after forecasting lower-than-expected 2026 profit.
Advancers were down by a 1.84-to-1 ratio on the NYSE. There were 71 new highs and 121 new lows on the NYSE.
On the Nasdaq, 1,960 stocks advanced and 2,696 declined as advancing issues outnumber declining issues by a 1.38-to-1 ratio.
The S&P 500 posted 2 new 52-week highs and 13 new lows while the Nasdaq Composite recorded 44 new highs and 112 new lows.
U.S. trading volume was 17.79 billion shares, compared to the 20.09 billion average for the full session over the past 20 trading days.
