Benchmark indices on Wall Street, particularly the Dow Jones, had a down day on Thursday as the sell-off resumed on fears of the economic costs of the war with Iran and with crude prices crossing higher levels each passing day.
The Dow Jones fell nearly 800 points, and with this fall, the index has turned negative for 2026. The S&P 500 and Nasdaq, also fell, but recovered from the lows to end with losses of 0.6% and 0.3% respectively. At the session’s low, the Dow was down over 1,100 points, while the S&P 500 and Nasdaq recovered 60 and 250 points respectively from the lows of the day.
US crude (West Texas Intermediate) surged as much as 8.5% overnight to close above the mark of $81 per barrel. This was the biggest single-day gain for the crude grade since May 2020. Brent also made a high above $86 per barrel before cooling off slightly and trade above the $84 a barrel mark. Prices have continued to surge as the war in West Asia rages on in to another day.
The US Dollar index also recovered from the early weakness, tested intraday highs of 99.44, before settling above the mark of 99. The index for the greenback is finding some resistance to reach levels of 100. A stronger dollar and fading hopes of the Fed cutting interest rates more than once this year have taken both Gold and Silver prices down, negating the war premium these assets generally carry. Bitcoin prices are also lower, but are holding on to the $70,000 mark.
“More caution is warranted” from investors if there’s no quick resolution to the war, Steve Sosnick, chief strategist at Interactive Brokers, said in an interview. He called the effective closure of the Strait of Hormuz, a critical oil chokepoint, a “black swan” event and said he’s surprised that it took until Thursday for markets to more fully reflect the severity of the event.
BofA Securities has also warned that higher oil prices from a longer conflict could put upward pressure on headline, core inflation and inflation expectations for the months ahead.
Chipmakers Nvidia and AMD fell up to 2.5% after Bloomberg reported that the US administration is writing draft regulations that would ask companies to seek permission before importing the high grade chips made by these companies. However, they recovered when the report further stated that the regulations are not final and they could change or even be entirely scrapped.
The focus today will be on the non-farm payrolls data that will be reported for the month of February with economists projecting a figure of 50,000 jobs being added after a strong January. Retail sales, unemployment rate and other such macro data will also be reported today.
(With Inputs From Agencies)