The S&P 500 and Dow retreated on Wednesday while oil jumped about 5%, after President Trump declared the US-Iran agreement "over" and threatened fresh strikes. The Nasdaq trimmed its losses to close higher.
The S&P 500 closed down 0.28% at 7,482.71 on Wednesday, pulled lower as renewed US-Iran tensions rattled markets and drove oil sharply higher. The Dow Jones Industrial Average fared worse, falling roughly 1%, or more than 500 points. The tech-heavy Nasdaq Composite bucked the trend, trimming earlier losses to gain 0.2%.
Trump calls the Iran deal "over"
The selling followed a sharp reescalation in US-Iran tensions after American forces struck Iran late Tuesday, responding to attacks on three commercial vessels in the Strait of Hormuz. Speaking in Ankara ahead of a NATO summit, President Trump said the US-Iran ceasefire agreement was finished. According to Yahoo Finance, Trump said of Iran: "As far as I'm concerned, it's just a waste of time dealing with them."
He later added that he did not think the war in Iran would fully restart, Bloomberg reported, even as he suggested the US would probably strike again that night. Nine of the S&P 500's 11 sectors declined, led by industrials and materials.
Oil surge stokes inflation worries
Energy markets did the most damage. The Treasury revoked a license that had allowed Iran to export oil globally, adding to concerns over potential supply disruptions. Crude climbed about 5%, with West Texas Intermediate trading above $74 a barrel and Brent holding near $78. The jump revived inflation concerns and pushed Treasury yields higher.
Investors also combed the Fed's June meeting minutes, the first under Chairman Kevin Warsh, which revealed a divided committee: a few officials argued a rate hike could be warranted, though policymakers ultimately agreed to hold rates steady. That left the rate unchanged even as the committee split over whether a hike was needed.
Sources: Yahoo! Finance Canada, marketscreener.com
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