US stocks today: US stocks tumble to lowest close in 6 months as Iran war drags; Nasdaq confirms correction
Why it matters: The Iran war is crushing investor confidence, signaling deeper market pain and a potential shift in Fed policy.
- US stock markets experienced their fifth consecutive weekly decline, the longest streak in nearly four years, with the Dow, S&P 500, and Nasdaq all falling significantly.
- The Nasdaq Composite officially entered correction territory, defined as a 10% drop from its prior high, following the Russell 2000 which confirmed its correction last week.
- President Trump issued a 10-day ultimatum to Iran to reopen the Strait of Hormuz or face destruction of energy plants, after Iran rejected his peace proposals.
- Secretary of State Marco Rubio expressed confidence the US could achieve its objectives in Iran within weeks without ground troops, despite recent military deployments.
- Oil prices surged, with U.S. crude up 5.46% and Brent rising 4.22%, contributing to inflation fears and impacting expectations for central bank monetary policy.
- Money market participants no longer anticipate any interest rate cuts from the U.S. Federal Reserve this year, a stark reversal from prior expectations of two cuts before the conflict.
- Ken Polcari, chief market strategist at SlateStone Wealth, views the current downturn as a potential "big opportunity" but warns of a possible 15% to 20% drawdown before recovery.
- Megacap stocks like Nvidia and Amazon were major drags on the S&P index, while consumer discretionary stocks, including cruise operators Carnival and Norwegian, also saw sharp declines after profit forecast cuts.
US stocks have plunged to a six-month low, with the Nasdaq confirming a correction, as the ongoing Iran war fuels inflation fears and dampens hopes for interest rate cuts. Despite President Trump's ultimatum to Iran and Secretary Rubio's optimistic timeline for the conflict, markets remain deeply pessimistic, bracing for further declines.
