U.S. stock markets experienced significant volatility on Tuesday, with the major indices closing mixed after a tumultuous session.
Equities opened higher but faced a midday sell-off, with the Nasdaq Composite plunging over 3% at one point before paring losses into the close.
The market mood was influenced by escalating Middle East tensions, as U.S. Central Command forces conducted a defensive strike against Iran in response to the downing of a U.S. Army Apache helicopter the previous day.
Iran vowed a strong response to what it termed U.S. aggression.
Following the news, WTI crude oil opened 0.8% higher on Wednesday, trading around $90.28 per barrel.
U.S. Equities
At the closing bell, the Dow Jones Industrial Average gained 86.1 points, or 0.17%, to 50,872.11.
The Nasdaq Composite fell 250.84 points, or 0.97%, to 25,678.82.
The S&P 500 index declined 19.08 points, or 0.26%, to 7,386.65.
Notable decliners included Marvell Technology (MRVL.US), down 7.6%, and Alphabet (GOOG.US, GOOGL.US), which fell 5.6%. Tesla (TSLA.US) shares dropped 3%.
The Nasdaq Golden Dragon China Index closed 0.39% lower.
European Markets
In Europe, Germany's DAX 30 index fell 218.10 points, or 0.89%, to 24,423.75.
Britain's FTSE 100 index dropped 141.59 points, or 1.36%, to 10,231.61.
France's CAC 40 index edged up 4.14 points, or 0.05%, to 8,203.43.
Asian Markets
Asian markets were mostly higher, with Japan's Nikkei 225 index gaining 2.17%, South Korea's KOSPI rising 8.18%, and India's Sensex index advancing 0.54%.
Currency and Commodities
The U.S. Dollar Index, which measures the greenback against a basket of six major currencies, fell 0.13% to settle at 99.909.
In cryptocurrencies, Bitcoin fell 2.6% to $61,812.2, while Ethereum dropped over 3% to $1,652.
Oil prices fell significantly, with July WTI crude futures down $3.10, or 3.4%, to $88.20 per barrel.
August Brent crude futures fell $2.80, or 2.97%, to $91.45 per barrel.
Spot gold declined to $4,260.45, and spot silver was at $65.347 per ounce.
Key Economic Developments
TD Securities anticipates that the upcoming U.S. May CPI report will confirm inflation is cooling but remains stubbornly high.
The firm expects core CPI to rise 0.23% month-over-month, with the annual rate holding at 2.8%.
Headline CPI is forecast to rise 0.4% monthly, pushing the annual rate to 4.2%.
The Federal Reserve announced its annual bank stress test results will be released on June 25 at 4 a.m. ET, involving 32 large banks.
The U.S. trade deficit narrowed in April to $55.9 billion as exports surged to a record high.
Anthropic released a public version of its Mythos model but restricted its use in high-risk areas like cybersecurity.
U.S. existing home sales jumped 3.2% in May to an annualized rate of 4.17 million units, reaching their highest level this year and exceeding expectations.
The Canadian dollar fell to its lowest level this year as markets bet the Bank of Canada will lag behind other major central banks in raising interest rates.
Notable Corporate Updates
Alphabet (GOOG.US, GOOGL.US) has provided financing guarantees worth $35 billion for Anthropic's data center construction.
SUPER MICRO COMPUTER INC (SMCI.US) announced a $7 billion equity and convertible debt financing plan to fund components for approximately $39 billion in AI server orders received recently.
JPMorgan Chase (JPM.US) plans to deploy more powerful AI agents later this year capable of running autonomously for much longer periods, marking a significant milestone in enterprise AI adoption.
The bank noted AI is already boosting business performance, including a 20% increase in private banking sales.
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