4:15pm: Oil surge pressures Dow, S&P 500
US stocks finished mixed on Wednesday as a jump in oil prices fueled inflation concerns and weighed on investor sentiment.
The Nasdaq gained 52 points, or 0.2%, to finish at 25,871. The Dow fell 577 points, or 1.1%, to 52,348, while the S&P 500 declined 21 points, or 0.3%, ending at 7,483.
Markets came under pressure as crude oil prices surged about 5% on renewed tensions between the U.S. and Iran, raising concerns that higher energy costs could reignite inflation and complicate the Federal Reserve’s path on interest rates. West Texas Intermediate crude climbed above $74 a barrel, while Brent crude traded near $78.
Investors also digested the latest Fed minutes, which showed policymakers were united in keeping rates steady at their most recent meeting, but some officials saw a potential case for raising rates if inflation pressures persisted.
On the earnings calendar, Levi Strauss & Co (NYSE:LEVI). is set to report after the closing bell, while PepsiCo is scheduled to release results before markets open Thursday.
3:45pm: Proactive news headlines
- Millennial Potash Corp (TSX-V:MLP, OTCQB:MLPNF, FRA:XOD) said Gabon government officials visited its Banio Potash Project and reaffirmed support for the development while discussing infrastructure plans.
- OKYO Pharma Ltd (NASDAQ:OKYO) received positive FDA feedback supporting plans to advance urcosimod into a global Phase 3 trial for neuropathic corneal pain.
- Graphene Manufacturing Group Ltd (TSX-V:GMG, OTCQX:GMGMF) approved A$1.2 million in capital spending to advance design, engineering and procurement work for its planned Fulcrum graphene manufacturing facility in Australia.
- Royal Road Minerals Ltd (TSX-V:RYR, OTC:RRDMF, FRA:RLU) agreed to raise up to C$10 million through a share offering to fund its ongoing activities.
3:00pm: Market movers
- Kirby Corporation rose after Bank of America named it its top small- and mid-cap transport/shipping pick, reaffirmed a Buy rating and raised its price target to $182 on optimism for its Inland Marine and Power Generation businesses.
- FuelCell Energy (NASDAQ:FCEL) fell after pricing an upsized public stock offering at a discount, raising investor concerns about shareholder dilution.
- Air Canada (TSX:AC.B) appointed Anko Van der Werff as its next president and CEO, with the current Scandinavian Airlines chief set to succeed Michael Rousseau in January 2027.
- Millennial Potash Corp (TSX-V:MLP, OTCQB:MLPNF, FRA:XOD) said Gabon government officials visited its Banio Potash Project and reaffirmed their support while discussing infrastructure development.
- OKYO Pharma Ltd (NASDAQ:OKYO) said positive feedback from the U.S. Food and Drug Administration supports advancing its investigational therapy urcosimod into a global Phase 3 trial for neuropathic corneal pain.
- Alibaba Group (NYSE:BABA) rallied after a US judge temporarily blocked Pentagon-related restrictions while the company challenges its designation, boosting investor confidence ahead of earnings.
- Helen of Troy (NASDAQ:HELE) reported an unexpected first-quarter profit and raised its full-year revenue outlook as its restructuring efforts began to show results.
2:30pm: Fed minutes signal risks
Federal Reserve officials unanimously agreed to keep interest rates unchanged at their latest policy meeting, although a few participants said there was a case for raising rates, according to minutes released Wednesday.
The minutes showed most policymakers remained concerned that inflation could prove more persistent than expected, citing risks tied to strong artificial intelligence-related demand, tensions in the Middle East and the potential impact of tariffs. Those factors, they warned, could warrant further monetary tightening if price pressures intensify.
Federal Reserve staff also revised their economic outlook, raising inflation forecasts for 2026 and 2027 while lowering GDP growth projections. The updated forecasts highlighted upside risks to inflation, reinforcing concerns that progress toward the central bank's 2% target could be slower than previously anticipated.
1:30pm: Oil prices surge
Oil prices surged and stocks came under pressure after the U.S. Treasury revoked a license that had allowed Iran to export oil globally, heightening concerns about potential supply disruptions. West Texas Intermediate crude rose more than 5% to trade above $73 a barrel, while Brent crude climbed past $80 a barrel, adding to inflation worries and raising expectations that the Federal Reserve could keep monetary policy tighter for longer.
Kathleen Brooks, research director at XTB, said markets currently view the situation as a contained and temporary disruption rather than the start of a broader conflict. “The prevailing view is that this is short term issue that will get ironed out, and it will not trigger a broader conflict,” she said.
Brooks warned that a formal declaration of war by both sides could dramatically change the outlook, potentially pushing oil prices back toward $100 a barrel, prompting a long-term repricing of interest rate expectations and further weakening investor risk appetite.
12:05pm: Energy risks weigh on metals
Bank of America has cut its price forecasts for several base and precious metals, warning that lingering uncertainty over potential energy supply disruptions and a challenging macroeconomic backdrop are likely to pressure mined commodities through the autumn.
The bank said concerns about an energy shock remain an overhang despite easing hostilities in the Middle East, while the prospect of tighter US monetary policy and a stronger US dollar continues to weigh on sentiment, particularly for gold.
However, Bank of America expects the longer-term outlook for industrial metals to improve, citing constrained supply and resilient demand driven by global electrification. "Still, tight supply and resilient demand from the electrification of the global economy should ultimately be supportive for copper and aluminium, so we see scope for a recovery in prices after the summer," the bank said.
11:00am: Apple strikes Broadcom deal
Apple Inc (NASDAQ:AAPL, XETRA:APC) (Apple Inc (NASDAQ:AAPL, XETRA:APC), Apple Inc (NASDAQ:AAPL, XETRA:APC)) announced a new multiyear agreement with Broadcom Inc (NASDAQ:AVGO, XETRA:1YD) (Broadcom Inc (NASDAQ:AVGO, XETRA:1YD), Broadcom Inc (NASDAQ:AVGO, XETRA:1YD)) valued at more than $30 billion to design and manufacture custom silicon components and wireless connectivity technologies in the United States, marking the company's largest commitment under its American Manufacturing Program.
The agreement is expected to result in the production of more than 15 billion chips in the US and includes a $1.5 billion expansion and modernization of Broadcom's manufacturing facility in Fort Collins, Colorado. Apple said the investment will support hundreds of US jobs.
Under the agreement, Broadcom will manufacture advanced radio frequency components, including FBAR filters, as well as wireless connectivity technologies used in Apple products.
Apple said the deal advances its efforts to build a domestic silicon supply chain and forms part of its broader pledge to invest $600 billion in the US economy over four years through manufacturing, job creation and technology development.
10am: Wall Street starts in the red
Wall Street stocks have mostly opened in the red, after government bond yields climbed to around a seven-week high following the surge in oil prices.
The Dow Jones fell 1%, the S&P 500 dropped 0.5%, and the Nasdaq has lost 0.3%.
Sherwin-Williams, Home Depot, IBM and Boeing were among the biggest fallers on the Dow, while materials stocks led the declines on the S&P, with Smurfit WestRock, International Flavors & Fragrances, Amcor and PPG Industries among the biggest fallers.
Moderna, Palantir, ResMed, Universal Health Services and Axon Enterprise also featured prominently on the losers' list, all down 4-3%.
Top risers on the Nasdaq were AI-related, with semiconductor and storage stocks higher: SanDisk, Western Digital, Broadcom, Applied Materials, Lam Research and Arm Holdings all posting 2%-plus gains.
Baker Hughes also advanced as higher oil prices lifted energy shares, while Pinduoduo climbed as part of a wider support for Chinese tech names today.
8.15am: Stocks called lower as oil surges, Iran ceasefire 'over'
US stocks are expected to extend losses on Wednesday after oil prices spiked following an exchange of strikes between the US and Iran that led to President Donald Trump declaring the ceasefire "over".
Dow Jones futures were down 1.1%, with S&P 500 futures pointing to a 0.9% drop, while those for the Nasdaq were off 1.3%.
A day earlier, the Nasdaq led the declines, falling 1.2% to 25,819 as chipmakers came under pressure, with the S&P slipping 0.5% to 7,504 and the Dow finishing down 0.3% to 52,925 after briefly hitting a new high above the 53,000 mark earlier.
This came as oil prices started rising following reports of attacks on commercial ships in the Strait of Hormuz.
Then overnight, US forces launched strikes against more than 80 targets in Iran, with Central Command reporting that these were aimed at command-and-control networks, coastal radar sites, anti-ship missile capabilities, and Islamic Revolutionary Guard Corps small boats.
Alongside this, the US Treasury Department revoked a waiver that had allowed Iran to restart oil exports, which was followed by Tehran resuming attacks on its Gulf neighbours, including against Bahrain and Kuwait.
When asked about the 'memorandum of understanding' deal, Trump told reporters at the Nato summit: "To me, I think it's over. I don't want to deal with them anymore. They're scum... They're led by sick people.
"I'll speak to our negotiators. They want to negotiate - they're good people... but they have to come back to me. As far as I'm concerned, it's just a waste of time dealing with them."
West Texas Intermediate crude jumped 5.4% to $74.26 a barrel, continuing a rise from just above $67 last week.
The rise in oil has fuelled inflation concerns, pushing Treasury yields higher and prompting traders to dial back expectations of interest rate cuts.
Traders now see more than an 85% chance of at least one 25-basis point rate hike from the Federal Reserve before year-end, according to the CME’s FedWatch tool.
It comes ahead of minutes from the Fed’s last monetary policy meeting in June, which will be released later.
"But," said market analyst David Morrison at Trade Nation, "with new Fed Chair Kevin Warsh unwilling to provide forward guidance, it’s debatable if the minutes will be that helpful in understanding the Fed’s outlook for rate hikes this year."