Stocks sold off Tuesday in a risk-off move after the latest escalation in Middle East violence and as the market continued to face consolidation pressure after its run-up from the August lows. The Dow Jones industrial average eased 0.4 percent while the S&P 500 fell 0.9 percent and the Nasdaq dropped 1.5 percent. Bond yields, the dollar and oil prices rose.

Other negatives for stocks Tuesday included concern over the impact of the dockworkers strike, and a bad day for market heavyweight Apple after negative analyst commentary on its iPhone sales. Stocks recovered from their worst levels after it became evident that Iran's missile attack on Israel had effectively been repelled and that damage had been limited. Investors remain concerned by the prospect of more attacks and a wider war.

Oil prices rallied but came off their highs late in the day. The uptick helped energy stocks outperform, along with defensive plays, especially utilities. On the positive side, strength in Alphabet and Meta helped cushion the indexes from bigger declines. Worst performers included information technology, consumer discretionary, financials, industrials, and real estate.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.