Highlights
Rising oil prices and Iran war fear kept stocks under selling pressure Friday as the major stock indexes fell for a third straight week. The Dow Jones industrial average eased by 0.3 percent while the S&P 500 slipped 0.6 percent and the Nasdaq was down 0.9 percent. US bond yields, the dollar and oil prices all gained.
Lack of progress in easing passage of oil tankers and other shipping through the Strait of Hormuz plus more threatening rhetoric from both sides in the war left investors grappling with the prospect of a longer war and more persistently high energy prices. Separately, a downward revision in fourth quarter US economic growth left the distinct impression that the economy was already shaky ahead of the latest shocks.
Among sectors, big technology had a bad day in risk averse trading, along with machinery, precious metals miners, industrial metals, chemicals, and retail. Best were telecom, travel & leisure, big banks, homebuilders, and restaurant chains.
Definition
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.
Description
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.