Oil Prices Soar Amid Iran-US Tensions; US Stocks Sink Over Fed Decision

Oil prices jumped on Wednesday after fighting resumed in the war between Iran and the US, while the US stock market sank as investors reacted to the Federal Reserve's decision not to raise interest rates. The price of Brent crude soared 7.3% to settle at $88.09 per barrel.

The S&P 500 fell 1.5%, with the Dow Jones Industrial Average down 2.2% and the Nasdaq composite losing 1.7%. Tech stocks, which have been on a tear due to their involvement in artificial intelligence, were particularly hard hit, with Nvidia, Micron Technology, and AMD all falling.

Fed Chair Kevin Warsh implied that the bond market may already be doing some of the work to restrain inflation, pointing to how yields have climbed since the central bank's last meeting six weeks ago. He also emphasized that the Fed is trying not to give financial markets too many clues about its future actions on interest rates.

Analysts say that the recent growth in tech stocks, particularly those involved in AI, may be unsustainable if AI does not produce as much profit and productivity as hoped. The skepticism has hit South Korea's stock market, where Samsung Electronics and SK Hynix dominate, with Seoul's Kospi index tumbling 6% on Wednesday.