The S&P 500 fell on Thursday, weighed down by higher oil prices, as traders followed the latest developments from the Middle East.
The broad market index fell 1.74%, while the Nasdaq Composite fell 2.38%. The Dow Jones Industrial Average fell by 470 points, or 1.01%.
Crude oil prices rose on Thursday, putting pressure on stocks. Brent futures jumped 5% to above $108 a barrel. West Texas Intermediate futures rose 5% to above $94.
As stocks fell and oil prices rose on Thursday, yields on the 10-year and 2-year Treasuries rose sharply.
Speaking about the recent performance of oil prices, President Donald Trump said he thinks their rise, as well as the pressure seen in the broader market, is not as bad as he expected. “Everything will go back to where it was before and probably lower,” he said of oil.
Earlier Thursday, Trump said in a post on Truth Social that Iran “better get serious soon, before it’s too late, because when it does, there’s NO GOING BACK and it’s not going to be pretty.” The president also called Iran’s negotiators “very different” and “weird,” claiming they were “begging” the U.S. to reach a deal to end the now four-week war.
It comes after Iran’s foreign minister reportedly told state media on Wednesday that the Middle Eastern nation’s top authorities are considering a US proposal to end the war, but Tehran has no intention of talking to the US.
Meanwhile, the Persian Gulf countries issued a joint statement Thursday condemning Iran’s “criminal” attacks from Iraqi territory on their energy infrastructure. They added that they are ready to defend themselves in the future.
“While we value our brotherly relations with the Republic of Iraq, we call on the Iraqi government to take the necessary measures to immediately stop the attacks… on neighboring countries,” the joint statement said.
Wall Street is coming off a winning session, putting the major indexes on track for a winning week, even despite contradictory statements from the US and Iran regarding peace talks between the two sides, SEEbiz reports.
Tobin Marcus, head of US policy and politics at Wolfe Research, believes recent market movements signal investors are betting that Iran could be “lying”.
Markets “seem to conclude that Iran’s negative public message could be a smokescreen for a more accommodating private stance,” he wrote in a note. “We’re not so sure, and ambiguity can’t last long amid Trump’s 5-day deadline for talks.”
