Oil Price Volatility Weighs on US Stocks as Inflation Concerns Persist
U.S. stocks are experiencing volatility on Tuesday as oil prices continue to swing due to uncertainty surrounding the flow of crude from Iran.
The S&P 500 fell 0.3%, moving further away from its all-time high set on Friday, while the Dow Jones Industrial Average dropped 100 points, or 0.2%, and the Nasdaq composite declined 0.6%.
Oil prices remain unstable, with Brent crude briefly reaching $90 a barrel in the morning before falling back below $87, eventually settling at $88.77, up 1.2% from Monday's settlement price.
The high oil prices have contributed to rising inflation, with the average cost for a gallon of regular gasoline hitting $4.01, according to AAA, and economists expect the latest monthly reading on inflation to show a deceleration to 3.4% in July from 3.5% in June.
The Federal Reserve's decision to raise interest rates is also being closely watched, with traders betting on a coin flip's chance of a rate increase at its next meeting in September.