Markets Whipsaw as US Moves to Secure Shipping Lanes Amid Iran Conflict – US Market Wrap

A sharp selloff in stocks and bonds eased after the US pledged to safeguard shipping through the Strait of Hormuz, helping cool what had been a more than 9% surge in oil prices.

The S&P 500, which had fallen as much as 2.5% earlier in the session, finished down less than 1%. President Donald Trump said the US would escort and ensure tankers and other vessels through the critical energy chokepoint in an effort to prevent a broader supply shock. Oil pared gains on the announcement, with Brent hovering near $80 a barrel after settlement.

The conflict continued to escalate across the Middle East. Israel launched a new wave of strikes on Tehran, while Iran fired missiles toward Qatar, Bahrain, and Oman. Qatar and Iraq halted output at major energy facilities, adding to supply concerns.

With shipments disrupted, fuel costs have climbed. A sustained rise in diesel prices, widely used in freight, electricity generation, and heating, threatens to lift transportation costs and feed into broader inflation pressures. Gasoline prices have also jumped, amplifying those risks.

The Dow Jones Industrial Average, down more than 1,200 points at its session low, trimmed losses to roughly 400 points by the close. The yield on 10-year Treasuries rose three basis points to 4.06%, and the dollar gained 0.6%.