Body

U.S. equity markets retreated Tuesday as bond yields surged and oil prices fluctuated amid the ongoing Iran‑War‑induced closure of the Strait of Hormuz. The S&P 500 posted a 0.7% decline, marking its third straight loss since hitting an all‑time high, while the Dow Jones Industrial Average fell 322 points (0.6%). The Nasdaq Composite dropped 0.8% to close at 25,870.71, matching the verified FRED figure for the index on that day.

In the bond market, the 10‑year Treasury yield rose to 4.61%, and the spread between the 10‑year and 2‑year yields widened to 0.54 points. Higher yields lift mortgage rates and increase borrowing costs for companies building AI data centers, a sector that has been a major driver of recent market gains.

Oil markets remained volatile. Brent crude slipped 0.7% to $111.28 a barrel, still well above the pre‑war $70 level. The price swing reflects uncertainty over how long the Iran war will keep the Strait of Hormuz closed to oil tankers, a factor that continues to pressure both energy markets and broader equity valuations.

“Every flow has its ebb,” said strategists at Barclays Capital. They noted that investors have pumped more money than usual into U.S. stock funds, helping fuel “the fastest rebound in decades; now the pendulum could swing backwards.” The comment underscores the market’s sensitivity to shifts in bond yields and oil pricing.

Tech‑heavy stocks led the declines. Nvidia, a heavyweight on the S&P 500, fell 0.8% ahead of its scheduled earnings report, while Akamai Technologies dropped 6.3% after announcing a $2.6 billion convertible‑note offering. Home Depot bucked the trend, rising 0.9% after reporting earnings that edged past analysts’ expectations, though its same‑store sales metric fell short of forecasts.

The combination of rising Treasury yields, oil‑price uncertainty, and mixed corporate earnings signals that the rally that pushed U.S. equities to record levels may be nearing its limit. Investors will watch upcoming earnings reports, especially Nvidia’s, for clues on whether the technology sector can sustain its momentum amid tightening financial conditions.