US stock indices closed lower on Monday as renewed tensions in the Middle East and rising oil prices reignited inflation fears. The S&P 500 fell 0.5%, the Nasdaq slipped 0.2% and the Dow Jones Industrial Average lost 273 points. Hopes for a cease-fire dimmed as hostilities intensified and rhetoric hardened, undermining prospects for a near-term peace agreement.
Crude prices advanced, stoking concern that a fresh bout of inflation could force the Federal Reserve to raise interest rates before year-end. The yield on the 30-year US Treasury climbed to its highest level since 2007, underscoring investor unease over mounting government spending and the associated increase in long-term borrowing costs.
Credit-sensitive sectors, including financials and large-cap technology “hyperscalers,” closed broadly lower. Alphabet (Google) slipped 0.6%, Microsoft fell 3% and Meta declined 3.5%. Among financials, Berkshire Hathaway was down 1.1%, Visa lost 1.5% and American Express retreated 1.8%.
By contrast, semiconductor stocks outperformed, supported by strong reported revenue growth from Anthropic. The AI company is in talks with investment banks about a potential initial public offering that could rank among the largest on record. Micron Technology gained 4.1%, Intel rose 1% and SanDisk surged 9%.