Stocks, Bonds Fall as US-Iran Risks Whipsaw Oil: Markets Wrap
(Bloomberg) — A renewed bout of oil volatility sent stocks lower, with concerns about an escalation in Middle East hostilities outweighing attempts to bring about a pause in the war.
Most shares in the S&P 500 retreated, though a gauge of chipmakers bounced after sinking into a bear market. In a volatile session, US crude settled near $83. Worries that higher energy costs could boost inflation spurred bond losses. Gilts sank after new UK Prime Minister Andy Burnham unnerved investors over his approach to the country’s finances.
President Donald Trump vowed that Iran “will pay” for killing three US soldiers in recent days, even as mediators proposed a new truce. Tensions remained high as Tehran-backed Houthi militants in Yemen threatened to blockade Saudi Arabia in the Red Sea.
“The Iran situation continues to roil markets,” said veteran strategist Louis Navellier. “This is holding back the stock gains that should be expected given the strong earnings trends.”
This week brings the first results from the megacap group, and pressure is building for the companies to justify AI investments. Tesla Inc. and Alphabet Inc. kick off big tech’s reporting season Wednesday. Then, Microsoft Corp., Meta Platforms Inc., Apple Inc. and Amazon.com Inc. hit the following week.
“For stocks to rebound, we need some solid earnings from the key tech names this week, and de-escalation in Iran wouldn’t hurt,” said Tom Essaye at The Sevens Report. “Markets will want to see strong results and more signs of robust demand, but also evidence of restraint and a focus on stability.”
The recent tech pullback likely reflected a combination of profit-taking and investors reassessing whether the robust spending on components required for the AI buildout can continue, according to Brock Weimer at Edward Jones.
“AI will remain a durable investment theme, but we advise investors to complement that exposure with cyclical and value-oriented segments of the market,” he said.
Hedge funds pulled back from US tech stocks at a record pace over the past two months, according to Goldman Sachs Group Inc.’s Prime Services desk led by Vincent Lin.
“The persistence and magnitude of selling since early June point to significant length reduction by tech investors, and some signs of capitulation are starting to emerge,” the desk wrote.
Corporate Highlights:
Alphabet Inc.’s Google is developing a server chip designed to optimize its Gemini artificial-intelligence model, the Information reported, citing people familiar with the matter. BlackRock Inc. is looking to sell more than $12 billion of bonds to help finance a Meta Platforms Inc. data center campus in El Paso, Texas, according to people with knowledge of the transaction. A federal judge temporarily paused Paramount Skydance Corp.’s $110 billion takeover of Warner Bros. Discovery Inc. saying it “likely” violates antitrust law. AMC Entertainment Holdings Inc. soared after posting revenue for the second quarter that beat the average analyst estimate. Domino’s Pizza Inc. posted its slowest US comparable sales growth in five quarters as budget-conscious diners continue to pull back on dining out and new higher-priced offerings failed to drive growth. What Bloomberg strategists say…
“Dip buyers are already on the move after the Philadelphia Semiconductor Index fell into a bear market last week. But chips’ earnings resilience makes the rout only a temporary reset.”
—Tatiana Darie, Macro Strategist, Markets Live. For the full analysis, click here.
Some of the main moves in markets:
Stocks
The S&P 500 fell 0.2% as of 4 p.m. New York time The Nasdaq 100 was little changed The Dow Jones Industrial Average fell 0.6% The MSCI World Index fell 0.3% Currencies
The Bloomberg Dollar Spot Index was little changed The euro fell 0.2% to $1.1416 The British pound fell 0.1% to $1.3435 The Japanese yen was little changed at 162.49 per dollar Cryptocurrencies
Bitcoin rose 0.8% to $65,035.77 Ether rose 1.7% to $1,896.67 Bonds
The yield on 10-year Treasuries advanced four basis points to 4.59% Germany’s 10-year yield advanced two basis points to 3.15% Britain’s 10-year yield advanced eight basis points to 5.03% Commodities
West Texas Intermediate crude rose 0.6% to $82.98 a barrel Spot gold fell 0.2% to $4,008.48 an ounce ©2026 Bloomberg L.P.
