US stock indices dropped on Thursday on Middle East standoff and a batch of mixed earnings also dented investor sentiments.
At 09:46 a.m. ET, the Dow Jones Industrial Average fell 154.00 points, or 0.30%, to 49,341.55, the S&P 500 lost 6.61 points, or 0.10%, to 7,131.08 and the Nasdaq Composite lost 57.27 points, or 0.26%, to 24,593.45.
At the Open, the Dow Jones Industrial Average fell 205.2 points, or 0.41%, to 49,284.85. The S&P 500 fell 19.1 points, or 0.27%, to 7,118.8, while the Nasdaq Composite dropped 103.8 points, or 0.42%, to 24,553.747.
The S&P 500 and Nasdaq had shrugged off a jump in oil prices to close at record highs on Wednesday.
The US Defense Department on Thursday said its forces seized another tanker in the Indian Ocean that was transporting crude oil from Iran, while US President Donald Trump said that he has ordered the US Navy to “shoot and kill” boats placing mines in the Strait of Hormuz.
Iran vowed it would keep the strait closed to all except a few approved vessels for as long as the United States blockaded its ports.
“The earnings themselves don’t reflect the impact of the energy supply shock,” said Kiran Ganesh, multi-asset strategist at UBS Global Wealth Management.
“The oil shock is a drag on growth, there is also a lot of structural support. The market remains comfortable that as long as there is a path towards de-escalation, it can look through higher oil prices in the short term,” Ganesh added.
On the economic data front, an official report showed that the number of claims for jobless benefits rose only marginally last week.
Key Stock Movers
Tesla stock shed 3.8%, after the electric vehicle maker raised its spending plan to more than $25 billion for the year.
Lockheed Martin stock slumped 3.7% after the company reported a lower profit for the first quarter.
IBM shares plunged 12% after the firm’s quarterly revenue fell short of Wall Street expectations.
Stocks of Microsoft and Adobe fell 2.6% and 7.3%, respectively.
Texas Instruments stock climbed 10.5% after the firm forecast second quarter revenue and profit above analysts estimates.
American Airlines shares jumped 4.9%.
Crude Oil
Crude markets stabilized on Thursday, sustaining profits from the prior day amid deadlocked negotiations between Iran and the US and ongoing transit limitations within the Strait of Hormuz.
Brent crude futures rose marginally by 30 cents, or 0.29%, to $102.21 a barrel by 1321 GMT. West Texas Intermediate futures were up slightly more, by 48 cents, or 0.52%, at $93.44.
Both benchmarks closed more than $3 higher on Wednesday.
Bullion
Gold prices fell on Thursday, following news of a potential Lebanon-Israel ceasefire extension.
As of 1312 GMT, spot gold was down 0.3% at $4,723.61 per ounce. US gold futures for June delivery fell 0.2% to $4,741.50.
Among other metals, spot silver fell 2.3% to $75.89 per ounce, while platinum lost 2% to $2,032.77. Palladium was down 2.2% at $1,511.17.
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