Wall Street slipped from records while oil surged Monday as fighting in the Middle East raised uncertainty about a ceasefire in the war with Iran. The drop came as investors weighed how renewed attacks could affect energy supplies tied to the Strait of Hormuz and, in turn, pressure markets already near peak levels.
Stocks ended lower even as Wall Street remained near record territory and investors continued to look to upcoming earnings and corporate profit growth for support. The S&P 500 fell 0.4% after its latest all-time high, the Dow dropped 557 points, or 1.1%, and the Nasdaq composite slipped 0.2%.
Energy markets moved more sharply. Brent crude jumped 5.8% to settle at $114.44, according to the report, after the United Arab Emirates said it came under attack by Iran for the first time since the ceasefire took hold in early April. The reported attacks were described as appearing linked to U.S. President Donald Trump’s efforts to reopen the Strait of Hormuz.
Iran’s reported closure of the strait has kept oil tankers confined in the Persian Gulf and away from customers worldwide, the report said, contributing to a rise in Brent that had moved sharply higher from about $70 per barrel before the war. Trump told viewers Sunday that the United States would guide ships through the strait, but prices still rose on uncertainty about what would happen next.
The U.S. military said Monday that two American-flagged merchant ships had successfully transited the Strait of Hormuz. It also said it sank six small boats and set up an “enhanced security area” for ships crossing the strait.
While the oil move drove a broader reassessment of risk, the report also pointed to continued momentum from corporate results. Savita Subramanian, a strategist at Bank of America, said the median stock in the S&P 500 was tracking for its best growth since 2021. Tyson Foods joined Monday’s list of companies topping analysts’ expectations for both profit and revenue in its latest quarter, and the report said its stock rose 8% after results reflected higher prices.
Other earnings and guidance updates added to the day’s trading swings. Norwegian Cruise Line Holdings reported a better-than-expected profit for the latest quarter, but the company said it was feeling the effects of the war through higher fuel costs and customer caution, particularly around travel to Europe; its stock fell 8.6% after also citing “execution missteps” that it said left bookings below where it wanted them.
In logistics, UPS dropped 10.5% and FedEx fell 9.1% after Amazon said it has begun allowing Procter & Gamble, 3M and other large companies to use its logistics services to move inventory, fulfill orders and deliver packages directly to shoppers. Amazon rose 1.4% on the news, according to the report.
In a separate deal-focused move, GameStop slumped after it said it wants to buy eBay for $125 per share in cash and stock. The report said GameStop has already built a 5% stake in eBay, and it cited the company’s goal of cutting $2 billion in annual costs quickly; GameStop fell 10.1% while eBay rose 5.1%.
Beyond stocks, the day’s market moves extended into rates and overseas trading. The report said the 10-year Treasury rose to 4.43% from 4.39% late Friday, and it noted that the yield was at 3.97% before the war began—an increase that can make mortgages and other loans more expensive. In stock markets abroad, tech gains helped indexes in South Korea and Hong Kong rise, while European indexes were lower, including France’s CAC 40 down 1.7%. The report also said mainland China and Japan were closed for holidays.