US stocks take a hit on escalating Middle East combat
The S&P 500 closed Tuesday down 0.9%, falling from its record close on Monday.
Escalating conflict in the Middle East sent traders to the sidelines. The tech-heavy Nasdaq 100 was down 1.4%, while Russell 2000, which tracks small caps, retreated 1.5%.
Prices of oil jumped more than 5% on Tuesday early afternoon on the news that Iran launched a barrage of ballistic missiles at Israel, briefly topping $71 per barrel. The West Texas Intermediate crude for November delivery settled up 2.4%, while the global benchmark, December Brent crude, jumped 2.6%. However, crude oil futures were still nearly 20% below their 2024 peaks.
Among other commodities, gold and gas prices also rose.
The energy sector ETF gained 2.3%, the most among all 11 major sectors. Oil and gas company APA Corporation was the second-best S&P 500 performer on Tuesday, up 4.9%. Defense stocks advanced, as the iShares US Aerospace & Defense ETF climbed to a record high. Utilities also rose.
The tech sector was Tuesday’s biggest laggard, as the sector ETF suffered a 2.4% loss. It was dragged down by Apple, which fell 2.9%, and Nvidia, which lost 3.7%.
The dollar gained, while Treasury yields retreated.
