US Stock Movement | Dow Falls Over 500 Points, Nasdaq Drops More Than 2%

Iran conflict escalates, energy prices fluctuate sharply, inflation concerns push up bond yields in Europe and the US. The US stock market continued to be under pressure on Friday, with the Dow Jones Industrial Average dropping into the final stretch, with losses expanding to 511 points at one point, hitting 45,509 points. The Nasdaq fell more than 2%.

Likely 50% chance of Fed rate hike in October

Traders have increased the probability of the Federal Reserve raising interest rates in October to 50%, completely reversing previous expectations of rate cuts. Investors now expect over a 50% chance that the European Central Bank will raise rates at its next meeting in April. The latest market forecast indicates a 100% chance that the Bank of England will raise rates in June, with no possibility of rate cuts this year.

As of 2:59 a.m. local time, the Dow was at 45,536 points, down 484 points or 1.05%; the S&P 500 was at 6,504 points, down 102 points or 1.55%; the Nasdaq was at 21,631 points, down 458 points or 2.08%. Honeywell’s stock fell 3.9%, temporarily the worst-performing Dow component; Boeing dropped 3.7%, and Nvidia declined 2.9%.

Although Israel signaled a temporary halt to attacks on Iran’s energy facilities, Iran continued to launch attacks in the Persian Gulf region. Meanwhile, according to Axios, citing four sources, the Trump administration is considering occupying or blockading Iran’s main oil export hub, Kharg Island, to pressure Iran and reopen the Strait of Hormuz.

Nicolas Forest, Chief Investment Officer at Candriam, noted that the current market environment is quite fragile. With oil prices remaining high and the risk of rate hikes increasing, if the stock market cannot hold technical support levels, it could signal further pressure ahead.