Oil Prices Surge Amid US Stock Dip; Markets Steady Before Trump’s Iran Deadline
Markets reacted cautiously Tuesday as oil prices surged while major U.S. stock indexes slipped ahead of President Trump’s self-imposed 8 p.m. ET deadline. Filmogaz.com reports rising geopolitical tensions around the Strait of Hormuz drove much of the market action.
Equity markets
The S&P 500 fell 0.5 percent. The Dow lost 271 points, roughly 0.6 percent, as of 9:35 a.m. ET.
The Nasdaq retreated about 0.6 percent. Officials said diplomatic talks were ongoing, but outcomes remained unclear.
Oil and the Strait of Hormuz
U.S. benchmark crude climbed 3.1 percent to $115.86 per barrel. Brent rose 0.4 percent to $110.17.
Both benchmarks sit far above roughly $70 per barrel before the conflict began. Prices have surged since late February.
Much Persian Gulf crude passes through the Strait of Hormuz. Iran has restricted passage to hostile parties.
Iranian officials called on young people to form human chains to protect power plants. President Trump threatened strikes on those facilities if the strait was not reopened.
On Monday, Iran rejected a ceasefire proposal and demanded a permanent end to the war. The standoff kept supply worries and prices elevated.
Investor concerns
Market participants fear a prolonged disruption would keep oil prices high and fuel inflation. That risk could dent global growth.
Paul Christopher of Wells Fargo Investment Institute said investors would likely stay on edge until a clear outcome emerged. Scenarios include a deal, intensified strikes, or escalatory retaliation.
Other market movers and bonds
Bill Ackman’s Pershing Square offered roughly $64 billion in cash and stock to buy Universal Music Group. The bid would move UMG to Nevada and list it on the New York Stock Exchange.
UMG shares in Amsterdam rose 9.3 percent but remained below the offer level. The gap suggests investors doubt the deal will close.
European indexes showed mostly modest movement. Asian markets were slightly firmer, led by South Korea’s Kospi, which rose 0.8 percent.
The 10-year Treasury yield held at 4.34 percent, unchanged from late Monday. It remains above the pre-war level of 3.97 percent.
Higher yields have pushed mortgage and loan rates up. That trend can slow consumer spending and business investment.
The oil prices surge helped drive the US stock dip, even as markets generally appeared steady while awaiting Trump’s Iran deadline. Investors continue to watch developments closely.
