Market Snapshot: Wall Street’s Volatile Day
NEW YORK — After a couple of days of gains, Wall Street saw some turbulence again, with stocks recovering most of their initial losses.
The S&P 500 dipped by 0.1% after facing a drop of 1.5% earlier in the day. By 11:08 a.m. ET, the Dow Jones Industrial Average was down 87 points, or 0.2%. The Nasdaq Composite also fell by 0.1%. European markets saw their declines lessen.
Oil prices continued their upward trend, although they were lower than the highs reached previously. At one point, US crude oil approached nearly $114 per barrel.
This fluctuation in trading followed President Trump’s national address late Wednesday, which didn’t clarify when the conflict in the Middle East might end. His comments seemed to dampen expectations of a quick resolution, which had been helping to boost stocks earlier in the week.
Despite the day’s volatility, major indexes are still on track to wrap up the week positively, with Thursday marking the final trading day before the stock market closes for Good Friday.
Oil prices have been a significant driver in the surge of global stock values. Traffic through the Strait of Hormuz, a critical route where about one-fifth of the world’s oil is traded, has been drastically reduced.
The international benchmark, Brent crude, saw a 4.8% rise to $105.99 per barrel. Meanwhile, benchmark U.S. crude increased by 8.4% to $108.82 per barrel, surpassing $110 before retracting. Before Trump’s speech, prices had dipped towards $100 a barrel. The U.S. gets only a fraction of its oil imports from the Persian Gulf, yet oil is a globally traded commodity; disturbances in one area influence prices worldwide.
Since the onset of the war, markets have experienced broad declines, often responding sharply to Trump’s remarks about the conflict’s direction. Earlier in the week, the S&P 500 nearly fell 10% from its all-time high, a significant drop that investors would term a “correction.” However, it rebounded on Tuesday and Wednesday on hopes that the war might come to a swift conclusion.
Notably, airlines and travel companies were among the hardest hit on Thursday. United Airlines fell by 3.3%, and Carnival dropped by 3.6%. In contrast, energy companies saw gains, with Chevron up by 1.6%.
In the bond market, government bond yields remained fairly stable, with the yield on 10-year government bonds slipping to 4.30% from 4.32%.
There is growing concern that rising energy costs are contributing to persistent inflation. Higher fuel prices are taking a toll on consumers. Currently, U.S. gasoline prices have surged more than 33% from a month ago, averaging $4.08 a gallon, according to AAA.
Moreover, elevated fuel prices typically cause the costs of various goods and services to rise. Airlines have begun increasing ticket prices to offset higher fuel costs, and shipping prices are escalating, making consumer products more expensive.
Inflation has remained above the Federal Reserve’s 2% target. The ongoing war and the subsequent spike in energy prices have intensified inflationary pressures, casting doubt on anticipated Fed rate cuts. There were expectations that the central bank might lower interest rates in response to a weakening labor market; reduced rates could potentially stimulate the economy by lowering borrowing costs, but they could also worsen inflation.
Market participants are anticipating multiple cuts to the Fed’s benchmark interest rate, which influences mortgage and other loan rates, as we move towards 2026 but expect stability in the rate throughout this year.
