The three major U.S. stock indices fell on August 10 as tensions surrounding the reopening of the Strait of Hormuz led to a nearly 5% surge in international oil prices, coupled with a significant decline in semiconductor stocks.
The Dow Jones Industrial Average closed down 60.95 points (0.11%) at 53,975.98. The S&P 500 index fell 4.53 points (0.06%) to finish at 7,753.11, while the tech-heavy Nasdaq Composite dropped 85.26 points (0.32%) to close at 26,605.36.
After reaching an all-time high on August 7, the S&P 500 took a breather as expectations for an early reopening of the Strait of Hormuz weakened, contributing to rising oil prices that pressured the stock market.
According to Reuters, Iran is demanding the lifting of U.S. sanctions, cessation of military threats, and compensation for war damages. The U.S. is also seeking compensation for its own losses, leaving both sides far apart in negotiations.
This uncertainty has caused a sharp increase in international oil prices. Brent crude futures rose by $4.17 (4.99%) to $87.72 per barrel, while West Texas Intermediate (WTI) crude increased by $3.95 (5.05%) to $82.13.
Concerns have also emerged that rising oil prices could exacerbate inflation in the U.S. The yield on 10-year U.S. Treasury bonds climbed to around 4.7%, adding further pressure to the stock market.
Semiconductor stocks experienced widespread declines, with the Philadelphia Semiconductor Index plummeting 2.94%.
Nvidia fell 2.9% amid reports of a large funding plan for AI infrastructure in collaboration with Apollo Global, BlackRock, Blackstone, and Goldman Sachs, leading to profit-taking after recent stock gains.
Intel dropped 4.1% after announcing plans to raise $15 billion through stock sales to fund its foundry business expansion, raising concerns about the dilution of existing shareholders' equity due to the large new share issuance.
Memory chip stocks also faced declines, with Micron down 1.9% and SK Hynix's American Depositary Receipts (ADRs) falling 1.90% to $135.29. Broadcom and Qualcomm also saw decreases of 1.25% and 3.39%, respectively.
In contrast, energy stocks benefited from rising oil prices, with Chevron up 4.48% and Occidental Petroleum rising 4.90%.
Market attention is now focused on the U.S. Consumer Price Index (CPI) for July, set to be released on August 12. With a slowdown in the labor market easing concerns about Federal Reserve tightening, the impact of soaring oil prices on inflation is expected to be a key factor influencing future interest rate decisions.
* This article has been translated by AI.
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