Market falls
US markets saw strong selling pressure in early trade. The Dow Jones Industrial Average fell more than 400 points. The S&P 500 dropped close to 1%, while the Nasdaq Composite declined over 1.4%. The Nasdaq is now down more than 10% from its recent peak, confirming a correction. The S&P 500 is down about 8%, and the Dow is also nearing a 10% fall.
Reasons behind
A key reason for the fall is the sharp rise in oil prices. Brent crude crossed $110 per barrel after fresh tensions near the Strait of Hormuz raised fears of supply disruption. Higher oil prices increase inflation. When inflation rises, markets expect interest rates to stay high for longer. This reduces the appeal of stocks, especially technology stocks that depend on future growth. Tensions near the Strait of Hormuz continue to worry investors, and comments from President Donald Trump haven't been reassuring either. The delay in action is being seen as extended uncertainty rather than reduced risk. The US 10-year Treasury yield climbed to 4.46%, its highest level since July. This shift pulls money out of equities. Technology stocks, which have higher valuations, face more pressure in such conditions. This is one reason the Nasdaq is falling faster than other indices.
Impact
Data from the University of Michigan shows that consumer sentiment fell to 53.3 in March. The expectations index dropped to 51.7. Inflation expectations also increased to 3.8% for the next year. Companies like Tesla, NVIDIA, and Intel declined as investors moved away from high-growth sectors. At the same time, some smaller stocks saw sharp gains. Artelo Biosciences surged over 300%, while Onconetix and Unity Software also posted strong gains. Commodities moved higher during the session. Oil prices surged due to supply concerns. Gold rose over 3%, and silver gained nearly 5%.
