Stocks Fall as US-Iran Strikes Spur Rally in Oil: Markets Wrap
(Bloomberg) — A flare-up in geopolitical risks sent stocks and bonds lower as oil jumped, raising concerns about inflationary pressures that could make the Federal Reserve raise interest rates.
Escalating tensions in the Middle East drove US crude above $85, with higher energy costs lifting Treasury 10-year yields toward the highest since January 2025. The S&P 500 trimmed its August advance.
The US and Iran exchanged strikes for the first time in about a month as American forces hit an island in the Strait of Hormuz and the Islamic Republic responded by launching attacks on the United Arab Emirates and Jordan. Iranian media also said authorities seized a bulk carrier and claimed an oil supertanker trying to go through the waterway was hit by mines.
The latest wave of hostilities dashed hopes for a near-term normalization of traffic through the key energy chokepoint, reinforcing bets on rate hikes after Fed Chair Kevin Warsh reiterated his commitment to bringing down inflation on Friday. While much hinges on employment data this week and inflation figures to follow, traders see a rate hike as more likely than not in September.
Corporate Highlights:
Nvidia Corp. is investing $3.5 billion into MediaTek Inc., deepening collaboration with the Taiwanese chipmaker at a time when it’s working to persuade more companies to build chips that plug into its dominant data center ecosystem. Eli Lilly & Co. plans to buy Merida Biosciences Inc. for as much as $2.88 billion in cash to expand in autoimmune and allergic diseases, part of an effort to build beyond the weight-loss and diabetes markets that made it the largest pharmaceutical company in the world. GameStop Corp. said preliminary net sales for the second quarter will be between $780 million to $800 million, above the consensus estimate of $757 million. PG&E Corp. and Edison International tumbled after California legislators introduced a bill Saturday that would update the state’s wildfire response without shifting liability away from publicly traded utilities. Strategy Inc. resumed Bitcoin purchases after a 10-week pause, returning to its signature accumulation strategy after the crypto bear market pressured its shares, weakened confidence in the financing model and prompted a balance-sheet overhaul. Some of the main moves in markets:
Stocks
The S&P 500 fell 0.3% as of 9:32 a.m. New York time The Nasdaq 100 was little changed The Dow Jones Industrial Average fell 0.5% The Stoxx Europe 600 fell 0.1% The MSCI World Index fell 0.3% Currencies
The Bloomberg Dollar Spot Index fell 0.1% The euro rose 0.1% to $1.1599 The British pound was little changed at $1.3544 The Japanese yen rose 0.2% to 159.81 per dollar Cryptocurrencies
Bitcoin fell 0.7% to $78,030.59 Ether fell 1.5% to $2,452.6 Bonds
The yield on 10-year Treasuries advanced three basis points to 4.75% Germany’s 10-year yield advanced four basis points to 3.31% Britain’s 10-year yield advanced three basis points to 5.06% Commodities
West Texas Intermediate crude rose 2.9% to $85.85 a barrel Spot gold fell 0.4% to $4,438.84 an ounce ©2026 Bloomberg L.P.
