Stocks Fall as Hormuz Standoff Drives Oil Higher: Markets Wrap
(Bloomberg) — A flare-up in tensions over the Strait of Hormuz sent stocks lower as oil rose on concern that a prolonged closure of the waterway could worsen energy disruptions, boosting inflation and slowing the economy.
The standoff drove Brent to $103. A record-breaking rally in the S&P 500 paused, with traders also sifting through earnings. Software shares got hit as International Business Machines Corp. and ServiceNow Inc.’s results failed to ease concerns about artificial-intelligence disruption. Tesla Inc. declined after boosting its spending plan. Texas Instruments Inc.’s solid outlook lifted chipmakers for a 17th straight day.
President Donald Trump ordered the US Navy to shoot any boat putting mines in the strait, while the military said it intercepted two oil supertankers that tried to evade its effort to prevent passage to and from Iranian ports.
Tehran noted it will not take part in negotiations while a US naval blockade on its ports is in place, and Iran state TV cited the foreign ministry as saying its armed forces are ready to respond to further threats. Meantime, Israel’s defense minister said his country is poised to resume the war.
Traffic through the Strait of Hormuz remains largely frozen, with only occasional movements of Iran-linked vessels breaking the lull.
“There’s a fair bit of uncertainty when it comes to diplomacy between the two sides,” said Fawad Razaqzada at Forex.com. “Less comforting is the ongoing lack of clarity around the Strait of Hormuz. With no clear plan to reopen it, uncertainty remains elevated.”
Despite lingering geopolitical risks, the S&P 500 is poised for its best month since 2022 amid strong corporate profits, the revival of the AI trade and an otherwise resilient economy. Nearly 80% of the US equity benchmark’s firms have beaten first-quarter earnings estimates so far, according to data compiled by Bloomberg.
While volatility understandably increased with the onset of the Iran conflict, financial markets have proven relatively resilient, noted Adam Hetts and Oliver Blackbourn at Janus Henderson.
“Investors coalesced around the critical assumption that hostilities and the associated disruptions to the global economy would be short lived,” they said. “Our sentiment and positioning indicators showed drawdowns within several market segments reaching capitulation territory and could therefore represent attractive entry points.”
On the economic front, US business activity picked up in April, fueled by the strongest manufacturing growth in nearly four years. Jobless claims rose last week, though they remain at a level consistent with low layoffs.
Corporate Highlights:
Warner Bros. Discovery Inc. shareholders voted overwhelmingly to approve a merger with Paramount Skydance Corp., despite widespread opposition to the deal in Hollywood. Microsoft Corp. is offering voluntary retirement to thousands of its employees in the US. About 7% of the US workforce will be eligible for the buyouts, according to a person familiar with the planning. American Express Co. plans to boost spending on marketing and technology and said its customers’ spending on air travel has been slowing. Lockheed Martin Corp. reported first-quarter net sales that missed analyst estimates, with lower volumes in its F-16 fighter jet program and classified programs. Honeywell International Inc. said war in the Middle East is hurting revenue, primarily in the process automation unit that serves the customers in the energy industry. Southwest Airlines Co. declined to update its full-year profit guidance as US carriers contend with soaring fuel prices amid America’s protracted war in the Middle East. Spirit Aviation Holdings Inc. is in “very advanced discussions” with the US government on terms of a material financing package, its lawyer Marshall Huebner said Thursday. Super Micro Computer Inc. sank after BlueFin Research wrote that the server company had “lost a significant contract” with Oracle Corp. Comcast Corp. reported first-quarter financial results that exceeded analysts’ estimates with fewer losses among broadband customers, offsetting lackluster growth at its Peacock streaming service. Lululemon Athletica Inc. slipped after naming a Nike veteran as chief executive officer, underscoring investor skepticism that the yogawear brand can recapture the growth of past years. Freeport-McMoRan Inc. sank after the copper miner warned that a slower ramp-up at its flagship Grasberg mine in Indonesia will weigh on future production. Some of the main moves in markets:
Stocks
The S&P 500 fell 0.3% as of 1:05 p.m. New York time The Nasdaq 100 fell 0.3% The Dow Jones Industrial Average fell 0.5% The MSCI World Index fell 0.3% Currencies
The Bloomberg Dollar Spot Index rose 0.1% The euro fell 0.1% to $1.1691 The British pound fell 0.2% to $1.3478 The Japanese yen was little changed at 159.58 per dollar Cryptocurrencies
Bitcoin fell 0.7% to $77,869.15 Ether fell 3.1% to $2,318.32 Bonds
The yield on 10-year Treasuries was little changed at 4.31% Germany’s 10-year yield was little changed at 3.01% Britain’s 10-year yield advanced three basis points to 4.94% Commodities
West Texas Intermediate crude rose 3% to $95.79 a barrel Spot gold fell 0.4% to $4,720.76 an ounce ©2026 Bloomberg L.P.
