U.S. stocks tumble as Middle East tensions flare
NEW YORK, June 13 (Xinhua) -- U.S. markets sank on Friday, closing out a volatile week with losses after a dramatic escalation in Middle East tensions rattled global investors.
The Dow Jones Industrial Average plunged 769.83 points, or 1.79 percent, to 42,197.79. The S&P 500 fell 1.13 percent to 5,976.97, while the Nasdaq Composite dropped 1.30 percent to 19,406.83.
The sell-off accelerated in the afternoon session after the Israel Defense Forces reported that dozens of missiles were launched from Iran, stating "all of Israel is under fire." This followed Israeli airstrikes on Iran, which Tehran called a "declaration of war." The escalating conflict raised fears of broader geopolitical instability that could impact energy markets and global supply chains.
Ten of the 11 primary S&P 500 sectors finished in red. Financials and technology were the biggest laggards, falling 2.06 percent and 1.50 percent, respectively. Energy stocks, however, bucked the downtrend, gaining 1.72 percent as crude oil prices spiked on fears of supply disruptions in the Middle East.
"This conflict adds challenges to the already sizable collection of worries being maintained by the markets -- those aren't going away. At the bare minimum the spike in crude, if it persists, will have an almost immediate impact on inflation numbers," said Mark Malek, chief investment officer of Siebert Financial.
"If crude breaches and holds above the 100-U.S.-dollars (per barrel) mark, we could see U.S. inflation reaccelerate towards 5 percent," according to Phil Carr, head of trading at Britain-based firm GSC Commodity Intelligence.
Technology stocks, which have led much of this year's rally, saw widespread losses. Nvidia and Broadcom each fell more than 2 percent, while Microsoft, Apple, Amazon, Alphabet, and Meta Platforms also declined. Tesla rose nearly 2 percent, rebounding after snapping a four-day winning streak Thursday.
In economic news, the University of Michigan's consumer sentiment index rose to 60.5 in June, well above the 54 forecast by Dow Jones and marking a 15.9 percent jump from May. Despite the encouraging consumer outlook, it was not enough to offset investor anxiety over rising geopolitical risks.
With volatility likely to persist, investors will be watching closely next week for developments in the Middle East as well as signals from the Federal Reserve's upcoming policy meeting.
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