US stocks fell from their record heights Monday, while oil prices jumped following escalations in the Middle East that may be undermining the ceasefire in the war with Iran.
- The S&P 500 fell 29.37 points, or 0.4%, to 7,200.75, coming off its latest all-time high.
- The Dow Jones Industrial Average dropped 557.37 points, or 1.1%, to 48,941.90.
- The Nasdaq composite slipped 46.64 points, or 0.2%, to 25,067.80.
Stocks turned lower after the United Arab Emirates, a US ally, said it came under attack by Iran for the first time since the ceasefire took hold in early April, the
AP reports. The attacks appeared to be in response to President Donald Trump's latest efforts to reopen the Strait of Hormuz.
In the oil market, the price for a barrel of Brent crude leaped 5.8% to settle at $114.44. Iran's closure of the strait has kept oil tankers pent up in the Persian Gulf and away from customers worldwide. That in turn has sent the price of Brent soaring from roughly $70 per barrel before the war. Trump said Sunday that the United States would guide ships through the strait, which could get oil flowing again and bring down its price. But prices instead climbed with uncertainty about what would happen next. Hope is still high on Wall Street that the global economy can avoid a worst-case scenario because of the war. And in the meantime, companies continue to deliver big growth in profits.
Tyson Foods joined the list Monday of those topping analysts' expectations for both profit and revenue during the latest quarter. It sold less beef than it did a year ago, but it did so at prices that were 11.5% higher, so its total beef revenue edged up. It also sold more chicken and pork than a year earlier, at slightly higher prices. Its stock rose 8% and helped limit Wall Street's losses.
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Norwegian Cruise Line Holdings likewise delivered a better profit for the latest quarter than analysts expected. But it's feeling the effects of the war, which has not only raised pressure on fuel prices but also pushed customers to think twice about travel plans, particularly to Europe. The cruise operator said some "execution missteps" also have bookings below where it would like, and its stock fell 8.6%.
- UPS and FedEx dropped even more for some of the market's sharpest losses after Amazon announced a move that could cut into their businesses. The online giant said it's begun allowing Procter & Gamble, 3M and other big companies to use its logistics services to move inventory, fulfill orders, and deliver packages directly to shoppers. UPS dropped 10.5%, and FedEx fell 9.1%, while Amazon rose 1.4%.
- GameStop slumped after it said it wants to buy eBay, a much larger company, for $125 per share in cash and stock. Coming into the day, eBay had a total market value that was nearly quadruple GameStop's. GameStop said it has already built a 5% stake in eBay and sees opportunities to cut $2 billion in annual costs quickly. GameStop, whose stock briefly soared to market-shaking heights during the meme stock craze of 2021, fell 10.1%, while eBay rose 5.1%.
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