Dow sheds 0.60%, S&P 500 0.58%, NASDAQ 0.65%

WTI surges 6.7% to $102 a barrel, rising for 8th straight session

US 10-year Treasury yield tops 4.95% during trading, nearing 5%

August PPI up 5.4%, reigniting energy-driven inflation fears

A man walks past the New York Stock Exchange on Wall Street in Manhattan, New York. (Reuters)
A man walks past the New York Stock Exchange on Wall Street in Manhattan, New York. (Reuters)

Wall Street's three major indexes fell for a fourth consecutive session as global oil prices extended their rally past $100 a barrel and US Treasury yields surged.

Concerns over supply disruptions from a prolonged war between the United States and Iran, combined with rising producer prices, reignited inflation fears. This revived expectations that the Federal Reserve could raise its benchmark interest rate. Selling pressure intensified, particularly in technology stocks sensitive to high interest rates.

On Thursday (local time), the Dow Jones Industrial Average closed down 316.56 points, or 0.60 percent, from the previous day to 52,064.10. The S&P 500 fell 44.66 points, or 0.58 percent, to 7,591.70, and the tech-heavy NASDAQ Composite dropped 171.62 points, or 0.65 percent, to 26,081.72.

Selling was concentrated in interest-rate-sensitive technology shares. Nvidia fell 2.26 percent and Micron Technology tumbled 4.90 percent, while Intel lost nearly 6 percent. The prolonged war between the US and Iran and fears over oil supply disruptions have kept investor sentiment under pressure amid the surge in crude prices.

West Texas Intermediate crude futures for October delivery settled at $102.48 a barrel, up $6.43, or 6.69 percent, from the previous session. Brent crude for November delivery rose $6.42, or 6.34 percent, to $107.63 a barrel. Both benchmarks marked their highest levels since May 19. WTI extended its winning streak to eight straight sessions, its longest in three years.

The surge in oil prices deepened inflation concerns, and a jump in US Treasury yields added further pressure on the stock market. The yield on the 10-year US Treasury note topped 4.95 percent during trading that day, its highest level since October 2023. Some in the market expect the 10-year yield to test the 5 percent threshold.

The 30-year yield rose 7.5 basis points to close at 5.360 percent, its highest closing level since June 29, 2004. The two-year yield, which is sensitive to monetary policy, jumped 12.2 basis points to 4.548 percent — its largest increase since March and its highest level in more than two years.

The US producer price index for August, released that morning, further stoked inflation worries. The US Department of Labor's Bureau of Labor Statistics reported that the PPI rose 0.4 percent from the previous month and 5.4 percent from a year earlier. The rise in energy prices was particularly pronounced, with diesel prices jumping 24.1 percent from the previous month.

The data added further weight to expectations that the FOMC will raise its benchmark interest rate at next week's meeting.

Concerns are also growing that the war between the US and Iran will not end soon. The Wall Street Journal reported that senior aides to President Donald Trump are internally considering the possibility that the conflict with Iran could continue until 2029. That would be the end of his presidential term.


th5@heraldcorp.com