U.S. Stocks Fall as Iran Mines Strait of Hormuz

CNBC reported Wednesday that a sharp escalation in the U.S.-Iran conflict ended a prolonged rally on Wall Street. The Dow Jones Industrial Average closed Tuesday down 1.2%. The S&P 500 shed 0.7% and the Nasdaq Composite fell 0.9%.

Iran’s Mining of the Strait of Hormuz Rattles Markets

The catalyst was a stark warning from Secretary of State Marco Rubio. He told the Senate Foreign Relations Committee on Tuesday that Iran had placed mines across large portions of the Strait of Hormuz. Iranian forces have also been firing on commercial vessels in the waterway, he said. It was Rubio’s first congressional appearance since the Iran conflict began on Feb. 28.

A White House official confirmed to CNBC that the Pentagon has destroyed dozens of mines and more than 40 Iranian minelaying vessels. The Strait of Hormuz carries roughly 20% of global oil supplies, making it one of the most strategically sensitive shipping lanes on earth.

Oil Prices Climb Sharply on Supply Fears

Energy markets reacted swiftly. West Texas Intermediate futures rose more than 2% to $95.68 per barrel during early Asian trading Wednesday. Brent crude climbed nearly 1.9% to $97.81 per barrel. Both benchmarks reflect growing anxiety over a sustained disruption to Middle East oil flows.

Asia Markets Shrug Off Tension, Nikkei Hits Record

Also Read: Why Oil Markets Watch the Strait of Hormuz So Closely

Despite the geopolitical noise, Asia-Pacific equities climbed broadly on Wednesday. Japan’s Nikkei 225 surged 2.5% to close at 68,402.13, a fresh record high. Australia’s S&P/ASX 200 added 0.7%. Mainland China’s CSI 300 edged up 0.5%. Hong Kong’s Hang Seng bucked the trend, slipping about 1.6%. Indian benchmarks also declined, with the Nifty 50 and BSE Sensex both off around 0.9%. South Korean markets were closed for a public holiday.

Investors appeared willing to look past near-term risk, betting that U.S.-Iran negotiations might still yield a resolution.

A Wall Street Winning Streak Comes to an Abrupt End

Also Read: S&P 500 Closes Above 7,600 for the First Time

Just a session earlier, Wall Street had been in celebratory mode. The S&P 500 closed above 7,600 for the first time ever on Monday. The Dow added more than 228 points that day. The Nasdaq squeezed out a slim gain. Tuesday’s reversal underscored how quickly geopolitical shocks can cut through market momentum.

Australia also delivered mixed economic data Wednesday. First-quarter GDP grew 2.5% year-on-year, missing the 2.6% forecast. Weak household spending, lower government consumption, and weather-related mining disruptions all weighed on the result.

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