Stocks Sink as President Trump Signals Iran War Will Drag On

The S&P 500 Index ($SPX) (SPY) today is down -1.13%, the Dow Jones Industrial Average ($DOWI) (DIA) is down -1.15%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -1.53%.  June E-mini S&P futures (ESM26) are down -1.07%, and June E-mini Nasdaq futures (NQM26) are down -1.47%.

Stock indexes are sinking today as the price of crude oil soars more than +13% after President Trump dashed hopes for a quick end to the war with Iran.   During a speech to the American public on Wednesday evening, Mr. Trump pledged more aggressive action against Iran over the next two to three weeks and offered no concrete plans to reopen the Strait of Hormuz.  WTI crude oil prices soared to a 3.5-week high today and are fueling inflation fears, pushing bond yields higher.  The 10-year T-note yield is up +2 bp to 4.34%. 

Today’s US economic news was better than expected and supportive of stocks.  Weekly initial unemployment claims unexpectedly fell by -9,000 to a 2.5-month low of 202,000, showing a stronger labor market than expectations of an increase to 212,000.  Also, the Feb trade deficit was -$57.3 billion, narrower than expectations of -$60.6 billion.

Crude oil prices (CLK26) are surging by more than +10% today as the Iran war looks set to drag on and the Strait of Hormuz remains effectively closed.  The UAE is preparing to help the US and other allies open the Strait of Hormuz by force and is lobbying for a United Nations Security Council resolution authorizing such action.  The International Energy Agency warned that even if the war were to end within a few weeks, it would still take time for normal flows through Hormuz to resume, as some energy infrastructure has been damaged and is facing lengthy repairs.

The markets are discounting a 3% chance for a +25 bp FOMC rate hike at the April 28-29 policy meeting.

Overseas stock markets are lower today.  The Euro Stoxx 50 is down -2.25%.  China's Shanghai Composite closed down -0.74%.  Japan's Nikkei Stock 225 fell from a 2-week high and closed down sharply by -2.38%.

Interest Rates

June 10-year T-notes (ZNM6) today are down by -10 ticks.  The 10-year T-note yield is up by +2.0 bp to 4.339%.  June T-notes are under pressure today as soaring crude prices push inflation expectations higher.  WTI crude is up more than +10% at a 3.5-week high, pushing the 10-year breakeven inflation rate to a 1-week high of 2.361% today.  T-notes are also falling amid concerns that the war with Iran will drag on and keep pushing energy prices higher, worsening inflation, and possibly forcing the Fed to tighten monetary policy. 

European government bond yields are moving higher today.  The 10-year German bund yield is up +5.9 bp to 3.045%.  The 10-year UK gilt yield is up +10.1 bp to 4.931%.

Swaps are discounting a 58% chance of a +25 bp ECB rate hike at its next policy meeting on April 30.

US Stock Movers

The Magnificent Seven technology stocks are falling today, a bearish factor for the overall market.  Tesla (TSLA) is down more than -4%, and Meta Platforms (META) is down more than -2%. Also, Nvidia (NVDA), Alphabet (GOOGL), Amazon.com (AMZN), Microsoft (MSFT), and Apple (AAPL) are down more than -1%. 

Chip makers and AI-infrastructure stocks are retreating today, weighing on the broader market.  Micron Technology (MU) is down more than -6% to lead losers in the S&P 500 and Nasdaq 100. Also,  Western Digital (WDC), Sandisk (SNDK), and Lam Research (LRCX) are down more than -5%, and Advanced Micro Devices (AMD), ARM Holdings Plc (ARM), Seagate Technology Holdings Plc (STX), ASML Holding NV (ASML), and Marvell Technology (MRVL) are down more than -4%.  In addition, Applied Materials (AMAT), KLA Corp (KLAC), Broadcom (AVGO), and Microchip Technology (MCHP) are down more than -3%,  

Mining stocks are slumping today, with gold prices down more than -4% and silver prices down more than -7%.  Coeur Mining (CDE) and Hecla Mining (HL) are down more than -4%, and Anglogold Ashanti (AU), Barrick Mining (B), and Southern Copper (SCCO) are down more than -3%.  Also, Freeport McMoRan (FCX) is down more than -2%, and Newmont Corp (NEM) is down more than -1%. 

Airline stocks are moving sharply lower today as crude oil prices surge more than +10%, raising fuel costs and cutting into corporate profits.  United Airlines Holdings (UAL) and American Airlines Group (AAL) are down more than -6%, and Alaska Air Group (ALK) and Southwest Airlines (LUV) are down more than -5%.  Also, Delta Air Lines (DAL) is down more than -4%. 

Asset management stocks are falling today, led by an -8% drop in Blue Owl Capital (OWL) after it said it will limit redemptions from two of its private credit funds after facing a surge in withdrawal requests.  Also, Apollo Global Management (APO) is down more than -4%, and Ares Management (ARES) and Blackstone (BX) are down more than -3%.  In addition, BlackRock (BLK) and Franklin Resources (BEN) are down more than -1%.

Energy producers and energy service providers are rallying today as WTI crude oil soars by more than +13%. Diamondback Energy (FANG) is up more than +4% to lead gainers in the Nasdaq 100, and APA Corp (APA) and Occidental Petroleum (OXY) are up more than +4%.  Also, ConocoPhillips (COP) is up more than +3%, and Chevron (CVX) is up more than +2% to lead gainers in the Dow Jones Industrials.  In addition, Phillips 66 (PSX), Halliburton (HAL), Devon Energy (DVN), and Valero Energy (VLO) are up more than +2%. 

Alto Neuroscience (ANRO) is down more than -8% after its ALTO-101 to treat cognitive impairment associated with schizophrenia failed to achieve statistical significance versus placebo in a Phase 2 trial. 

Immunovant (IMVT) is down more than -4% after results from two late-stage studies of its treatment for thyroid eye disease failed to meet their primary endpoints. 

Akamai Technologies (AKAM) is down more than -1% after Baird downgraded the stock to neutral from outperform with a price target of $110. 

Globalstar (GSAT) is up more than +9% after the Financial Times reported that Amazon.com is in talks to acquire the company.

SM Energy (SM) is up more than +7% after BMO Capital Markets raised its price target on the stock to $33 from $26. 

Matador Resources (MTDR) is up more than +5% after KeyBanc Capital Markets raised its price target on the stock to $73 from $61. 

Wingstop (WING) is up more than +2% after Raymond James upgraded the stock to strong buy from outperform with a price target of $240. 

Earnings Reports(4/2/2026)

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