Wall Street’s primary indices experienced a significant decline on Thursday as U.S. President Donald Trump hinted at launching more aggressive actions against Iran, leading to diminished hopes of a prompt resolution to the Middle East conflict. In a televised address on Wednesday, Trump announced a plan to escalate military operations in the coming weeks, a stark shift from his previous statement suggesting a swift withdrawal from Iran.
Art Hogan, chief market strategist at B Riley Wealth, expressed concerns, stating, “The issue is that we are now in a state of uncertainty, knowing even less about how to navigate towards peace.” This development caused oil prices to surge by approximately seven percent, pushing Brent crude futures to $108 per barrel. Energy stocks in the U.S., such as Exxon Mobil and Chevron, saw increases of over two percent each, with the S&P 500 energy index rising by 2.4 percent.
The spike in oil prices adversely affected airlines, with United Airlines, Delta Air Lines, and American Airlines witnessing losses ranging between four and six percent. Additionally, concerns over private credit emerged after Blue Owl limited investor withdrawals from two retail-focused funds, leading to an eight percent decline in its shares.
Furthermore, asset managers like Apollo Global, Blackstone, and Ares Management experienced declines of 3.5 to 4.3 percent. Financial shares dropped by 1.1 percent, while technology stocks slid by 1.8 percent, with companies like Micron, Lam Research, and Sandisk falling by over three percent each.
As of 9:50 a.m. ET, the Dow Jones Industrial Average was down by 565.37 points, the S&P 500 lost 79.70 points, and the Nasdaq Composite decreased by 367.70 points. The Russell 2000 index also fell by 1.3 percent. The CBOE VIX index, commonly known as Wall Street’s fear gauge, rose to 26.79 points following a recent decline.
Earlier in the week, the expectation of a resolution to the conflict had boosted market sentiment, resulting in the largest weekly gains for Wall Street in four months and the first week of positive performance in six months.
Looking at the broader impact of the Middle East conflict, the S&P 500 and the Nasdaq reported their most significant monthly losses in a year in March, while Brent crude prices achieved their strongest monthly performance on record. Concerns about energy-driven inflation have clouded the Federal Reserve’s monetary policy outlook, with market participants no longer anticipating any easing from the central bank.
With U.S. markets closed for the Good Friday holiday, focus will be on the upcoming nonfarm payroll numbers and developments related to Elon Musk’s SpaceX, which recently filed for a U.S. initial public offering targeting a $1.75 trillion valuation. Additionally, Globalstar’s shares surged by 10 percent after reports suggested that Amazon is considering acquiring the low-earth-orbit communication satellites company.
Gas prices in Canada continued to rise, with the average national retail price per liter reaching $1.80. Prices varied across cities, with Vancouver at $2.14, Montreal at $1.95, Toronto at $1.82, and Calgary around $1.70 per liter. Newfoundland recorded an average price of $2.05 per liter, leading to concerns among consumers and gas station owners like Dawn Sharpe, who noted the increasing frequency of price changes, causing anxiety among consumers.