Dow Jones dropped nearly 700 points, chip stocks fell broadly, Intel fell over 4%, Nvidia and Apple fell 2%, crude oil surged toward $100.

Reporter | Zhang Jiayu Wu Bin

Editor | Zeng Jingjiao

On March 12, U.S. stocks opened lower and continued to decline, with all three major indices falling over 1%. As of 22:29 Beijing time, the Dow Jones Industrial Average dropped 1.46%, down nearly 700 points; the Nasdaq fell 1.57%; the S&P 500 declined 1.25%.

Large tech stocks all declined, with the Wind U.S. Tech Giants Index down 1.53%. Apple and Nvidia fell over 2%, while Tesla, Facebook, and Google dropped more than 1.5%.

Chip stocks collectively declined, with Teradyne and GlobalFoundries falling over 5%. Lam Research, TSMC, Applied Materials, and Intel dropped over 4%, while SanDisk and Micron Technology fell over 3%.

Honda Motor Co. fell 6.5%. According to news, on March 12, Honda announced its first annual loss since going public 69 years ago (since 1957). The company also stated that on the same day, it canceled some U.S.-made electric vehicle development and launch plans. The total costs and losses from reevaluating its electrification strategy are expected to reach up to 2.5 trillion yen (about 108.2 billion RMB).

Oil and gas resource stocks defied the trend and rose. U.S. energy stocks increased by 7.6%, with Murphy Oil up 3.8%, Western Oil up 3.3%, ConocoPhillips, Phillips 66, and Marathon Oil rising about 1.5%, and Chevron up over 1%.

In Chinese concept stocks, most popular stocks declined. Tencent fell over 2%, Alibaba and Baidu dropped more than 1%. Pony.ai fell over 3%, while Niu Technologies, Huya, and iQiyi declined over 2%. NetEase rose over 1%.

In precious metals, gold and silver moved mixed. Spot gold briefly fell by $25 after the new Iranian Supreme Leader’s statement was released, currently at $5,157.4 per ounce. Spot silver rose 0.59% to $86.23 per ounce.

International crude oil prices surged. Brent crude futures spiked 9% during trading, reaching $100 per barrel. As of the report, it was up 8.44% at $99.74 per barrel. WTI crude also rose over 8%, trading at $94.83 per barrel.

According to CCTV News, Iran’s new Supreme Leader, Mujtaba Khamenei, delivered his first statement on the 12th via national television. The speech mainly focused on Iran’s domestic unity, external conflicts, regional relations, and mourning the late leader Ali Khamenei. It mentioned that Iran will continue to adopt strategic measures, including blocking the Strait of Hormuz, and will open new fronts if necessary.

Due to the increased inflation risk caused by Middle East conflicts, Goldman Sachs has delayed its expectations for a Federal Reserve rate cut. It now expects the Fed to cut rates by 25 basis points in September and December. Previously, Goldman Sachs had forecasted a new rate-cut cycle starting in June, with another cut in September.

In the short term, Wu Qidi, director of the Xunda Information Securities Research Institute, predicts that the Federal Reserve is likely to keep interest rates unchanged at the March 17-18 meeting. The Fed is expected to declare that it will “ignore” the temporary supply shocks caused by geopolitical issues and focus on long-term inflation expectations and the trend of core services. This suggests the Fed will delay action until more data is available.

Looking ahead, Wu Qidi believes the Fed’s policy focus may shift toward medium- and long-term inflation expectations. If inflation remains controllable, the Fed might cut rates to support a weak labor market; if inflation expectations spiral out of control, it could turn to tightening.

According to Xinhua Finance, the U.S. initial jobless claims for the week ending March 7 were 213,000, slightly below expectations. 【Details】