Markets React to Middle East Tensions
Brent oil surged to $100.69 a barrel, the highest since May, as rising Middle East conflict threatens global crude flow. Attacks on Saudi oil tankers in the Red Sea and ongoing US-Iran tensions drove the spike.
US Stocks Slide
The S&P 500 fell 1.2%, the Dow Jones lost 1%, and the Nasdaq sank 2.2%, pressured by higher oil prices and earnings from Alphabet and Tesla. Tesla plunged 14.5% after weaker-than-expected profits, while Alphabet dropped 7.1% despite strong revenue, as investors worried about AI spending.
Impact on Treasury Yields and Inflation
Higher oil prices lifted the 10-year US Treasury yield to 4.69% from 4.67%, pushing mortgage rates to nearly a one-year high. Rising energy costs could accelerate inflation and influence central bank interest rate decisions.
Airline Stocks Fall
American Airlines dropped 8.4% and Southwest Airlines 6.2%, despite reporting better-than-expected profits, as fuel cost concerns weighed on investors.
Global Markets
European stocks fell sharply with France’s CAC 40 down 1.6%, while Asian markets showed gains, led by South Korea’s Kospi up 4.4%.
