US Stocks Crash as Oil Prices Soar Amid Ongoing Middle East Tensions
Oil prices surged and stocks plummeted on Tuesday following another round of US military strikes on Iran, adding to economic uncertainty. The S&P 500 index fell 0.7%, while the Dow Jones Industrial Average dropped 456 points (or 0.9%) as of 1:26 p.m. Eastern time.
The Nasdaq composite also fell 1%. Technology stocks were among the heaviest weights on the market, with Microsoft down 1.3% and Advanced Micro Devices falling 3% due to their reliance on borrowing amid an AI boom.
The ongoing sell-off in US government bonds is a major concern for Wall Street, with yields on the 10-year Treasury rising to 4.79% from 4.75% late Monday, while the yield on the 2-year Treasury rose to 4.38% from 4.34%.
Higher bond yields signal that investors are demanding a higher return due to growing government debt and risk. The US debt has surpassed $40 trillion, with defense costs and interest on the deficit making up a large share of federal spending.