Oil surge pushes US stocks to fourth straight loss
West Texas Intermediate crude jumped 7.1% to $102.93, driving a broad selloff in US equities.
US benchmark West Texas Intermediate crude settled 7.1% higher at $102.93 per barrel. This sharp increase triggered a decline in major US stock indexes. The Dow Jones Industrial Average fell 316.56 points to close at 52,064.10. The S&P 500 dropped 0.58% to 7,591.70. The Nasdaq Composite lost 0.65% to finish at 26,081.72. All three indexes recorded their fourth consecutive daily decline.
Investors reacted to rising energy costs and bond yields. The yield on the 10-year US Treasury note exceeded 4.95%. This is the highest level since October 2023. The CBOE Volatility Index rose 8.38% to 17.84. Market anxiety increased as the US-Iran conflict entered its seventh month. Oil prices have climbed 52.9% since the war began in late February.
Producer prices accelerate inflation concerns
US producer inflation data added to market pressure. The Producer Price Index rose 0.4% month-on-month in August. Annual growth accelerated to 5.4% from 4.8% in July. Energy prices climbed 4.2% during the month. Diesel fuel prices surged 24.1%. These figures suggest persistent inflationary pressures. The data may influence the Federal Reserve’s upcoming interest-rate decision.
Technology and semiconductor stocks faced significant selling. Intel shares fell more than 5.5%. Micron Technology declined 4.9%. Higher borrowing costs and energy expenses threaten to slow economic activity. Investors reduced exposure to growth-heavy sectors. This move reflects caution regarding future corporate earnings.
European markets close lower on ECB hike
European stock markets also ended the session in negative territory. The European Central Bank raised its three key policy rates by 25 basis points. The bank warned that geopolitical conflicts continue to fuel inflation. The pan-European Stoxx Europe 600 index fell 0.69% to 635.97 points. Britain’s FTSE 100 dropped 0.57% to 10,608.92. Germany’s DAX 40 declined 0.84% to 25,361.15.
France’s CAC 40 lost 0.49% to close at 8,116.76. Italy’s FTSE MIB 30 index edged down 0.13% to 51,807.40. Spain's IBEX 35 fell 0.18% to close at 19,659.80. The European Central Bank’s decision reinforced the global trend of tightening policy. Investors in Europe faced similar headwinds from rising oil prices. According to GN markets/inflation (en-US), the geopolitical backdrop remains a primary driver of market volatility.
