Surging oil prices and multi-year-high Treasury yields dragged Wall Street lower as traders braced for next week's Federal Reserve meeting.
US stocks closed lower on Thursday as a sharp rally in oil prices and climbing Treasury yields intensified inflation worries and boosted market expectations of a Federal Reserve interest-rate hike at its meeting next week, according to the Economic Times. The S&P 500 dropped 44.16 points, or 0.58%, to close at 7,592.20. The Nasdaq Composite fell 167.15 points, or 0.64%, to 26,086.19, while the Dow Jones Industrial Average lost 313.64 points, or 0.60%, ending at 52,067.02.
Oil Rally and Yield Spike Drive the Sell-Off
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The equity decline was driven primarily by a 6% spike in Brent crude oil prices to roughly $107 per barrel, alongside a climb in US Treasury yields to multi-year highs, the Economic Times reported. Both moves reinforced expectations that the Fed could raise interest rates at its upcoming policy meeting. Related coverage from Reuters and Bloomberg has tied recent oil spikes to escalating geopolitical tensions in the Middle East, including the US-Israel conflict with Iran, which have repeatedly rattled energy markets and stoked fears of supply disruptions. Rising energy costs have been cited across multiple outlets as a key factor complicating the Fed's efforts to bring down inflation, with the 10-year Treasury yield in related sessions climbing above 4.7%, a level last seen in early 2025.
US Stocks Fall as Brent Crude Tops $100 Ahead of Inflation Data
Chipmakers Slide While Apple Gains on iPhone Launch
Among individual stocks, Nvidia and Micron Technology declined as investors rotated away from high-valuation growth and semiconductor names amid higher yields and macroeconomic uncertainty, the Economic Times reported. Apple, however, closed higher, with the gain linked to the launch of its latest iPhone, which appeared to offset broader market weakness. The divergence reflects a pattern seen in related sessions, where product-specific catalysts have allowed individual names to outperform even as macro headwinds from oil and rates weighed on the wider market.
Traders are now focused on next week's Federal Reserve meeting, where policymakers will weigh incoming inflation and labor data against the inflationary pressure stemming from higher energy prices. If oil prices remain elevated, markets may continue pricing in a higher terminal rate or a longer period of restrictive monetary policy, according to the broader financial coverage of the episode.
