Iran fired a volley of ballistic missiles in retaliation for Israeli operations against Tehran’s ally Hezbollah. In response, US President Joe Biden ordered the US military to assist in the defense of Israel and shoot down missiles aimed at Israel, the White House National Security Council announced.
While the broader market fell, energy company stocks rose along with U.S. oil prices, with oil prices rising 2.4%. ExxonMobil stock rose 2.3%.
Defense stocks also rose, with Northrop Grumman up 3% and Lockheed Martin up 3.6%. The S&P 500 Aerospace & Defense Index rose to an all-time high. Utilities rose 0.8%.
Airlines stocks also fell, with Delta Air Lines falling 1.6%.
The index ended the day at its lowest point as investors hedged on the Middle East news. “If we see further escalation, we could see a continued market downturn because we don’t know how long this is going to last,” said Peter Taz, president of Chase Investment Counsel in Charlottesville, Virginia. . “The level of risk has increased. The market has had a strong year, but depending on what happens in the next few weeks, people could get scared out of the market.”
The Dow Jones Industrial Average fell 173.18 points, or 0.41%, to 42,156.97, the S&P 500 fell 53.73 points, or 0.93%, to 5,708.75, and the Nasdaq Composite Index fell 278.81 points, or 1.53%, to 17,910.36. .
On Monday, the three major U.S. indexes posted strong gains for September and the quarter.
The CBOE’s Market Volatility Index, Wall Street’s fear gauge, rose.
Data released early Tuesday morning showed that U.S. job numbers rebounded in August, while a report from the Institute for Managed Supply (ISM) showed manufacturing activity in September was 47.2, compared to an expected 47.5. It showed what happened.
Investors also became cautious ahead of Thursday’s U.S. unemployment claims and Friday’s monthly jobs report.
According to CME Group’s FedWatch tool, traders are pricing in a 38% chance that the Federal Reserve will cut interest rates by 50 basis points in November, up from about 35% on Monday but down from 58% a week ago. %.
The US central bank cut interest rates by 50 basis points on September 18, starting a new easing cycle.
Investors also monitored port strikes on the East Coast and Gulf Coast, which halted about half of the country’s international shipping.
While the strike that began Tuesday is not expected to cause global supply problems as severe or severe as during the COVID-19 pandemic, it is still an economic uncertainty that Fed policymakers should assess. Sexuality is on the rise.
Declining issues outnumbered advancing issues on the New York Stock Exchange by a ratio of 1.32 to 1. On the Nasdaq, a 2.36-to-1 ratio favored declining stocks.
The S&P 500 Index has recorded 51 new highs and 2 new lows in 52 weeks. The Nasdaq Composite recorded 75 new highs and 137 new lows.
Trading volume on U.S. exchanges was 13.16 billion shares, compared to an average of 11.98 billion shares traded over the past 20 trading days.
