Stocks Sink on Iran Escalation as Oil Shock Deepens Growth Fears – US Market Wrap
Wall Street extended its losing streak to the longest weekly slide since 2022 as investors grew more concerned that a prolonged war in Iran will keep oil prices elevated, adding to inflation pressures and weighing on economic growth.
Selling accelerated into the close, with the S&P 500 dropping 1.7%. The Nasdaq 100 entered correction territory, falling more than 10% from its peak. Brent crude climbed above $112 a barrel. In fixed income, shorter-dated Treasuries outperformed longer maturities. The yen weakened to 160 per dollar for the first time since 2024, reviving speculation about possible intervention.
The latest escalation came after the US and Israel struck Iranian nuclear and steel facilities, while Iran responded with attacks across the Persian Gulf. The move followed President Donald Trump’s decision to extend his deadline for Tehran to reopen the Strait of Hormuz or face strikes on power infrastructure.
The growing risk of a prolonged energy shock has intensified concern about financial stability, as higher oil prices could keep central banks in a restrictive policy stance while also making government debt burdens more vulnerable.
