US stock indices finished lower on Tuesday as concerns grew that tighter financial conditions could dampen economic growth. The S&P 500 declined 0.7%, the Dow Jones Industrial Average fell 419 points, and the Nasdaq 100 slid 1.3%.
US-Iran strikes in the Persian Gulf extended the disruption of energy exports from the region and intensified global inflation risks, bolstering expectations that major central banks may resume interest rate hikes this year. At the same time, a surge in AI-related corporate debt issuance increased credit supply and pushed bond yields higher.
Technology shares led the decline: Micron fell 2.6%, AMD dropped 2.4%, Oracle and Palo Alto Networks each lost 5.2%, and Dell slid 6.8%. Nvidia slipped 1.5% despite a $35 billion computing agreement between Lambda and Anthropic. Asset managers also weakened, with Blackstone down 4.6% and KKR off 3.1%.