US Stocks Plunge as Iran Conflict Drives Oil Prices Higher
US stocks fell on Monday as renewed military clashes between the US and Iran pushed oil prices higher, adding to concerns about inflation. The Dow Jones Industrial Average dropped 346 points, while the S&P 500 was almost unchanged and the Nasdaq Composite declined 0.52%. The weakness comes as investors enter September, historically a challenging month for equities.
The military clashes between the US and Iran resumed in the Middle East, with disruptions around the Strait of Hormuz affecting oil shipments. West Texas Intermediate crude traded more than 3% higher at above $86 a barrel, while Brent crude futures rose more than 3% to above $91 a barrel.
Energy stocks benefited from the move in crude prices, with Halliburton and Valero Energy rising 3.04% and 1.84%, respectively. Higher oil prices could add to inflation concerns at a time when investors are already focused on the Federal Reserve's next policy decision.