NEW YORK (AP) 鈥� With no clear end in sight, the sent oil prices back to $100 per barrel on Thursday, and stocks sank worldwide.
The S&P 500 fell 1.5% and resumed its following a couple days of . The Dow Jones Industrial Average dropped 739 points, or 1.6%, and the Nasdaq composite lost 1.8%.
The center of action was again the oil market, where the price of a barrel of Brent crude, the international standard, climbed 9.2% to settle at $100.46. Worries are worsening that the war could in the Persian Gulf for a long time and cause a debilitating for the .
Iran鈥檚 new supreme leader released his first statement Thursday since succeeding his late father, saying his country would on Gulf Arab neighbors and use the effective closure of the as leverage against the United States and Israel. A fifth of the world鈥檚 oil typically sails through the strait, and oil producers in the region are cutting production because their crude has nowhere to go.
Countries around the world are trying to make up for that, and the International Energy Agency said Wednesday that its members would , 400 million barrels, from stockpiles built for such emergencies.
But such moves are short-term fixes, and they do not clear the long-term risks. Analysts have said that if the Strait of Hormuz remains closed, oil prices could jump to $150.
To be sure, the U.S. stock market has a relatively quickly from military conflicts in the Middle East and elsewhere, as long as oil prices don鈥檛 stay too high for too long. Even with all the and- swings of the last couple weeks, many rocking markets , the S&P 500 is just 4.4% below its all-time high set in January.
What鈥檚 made this jump for oil prices frightening is not only the degree 鈥� prices jumped near $120 this week to their highest level since 2022 鈥� but that they鈥檙e occurring during an uncertain time for the economy.
Last month鈥檚 , which raised worries about a possible worst-case scenario for the economy called 鈥渟tagflation.鈥� That鈥檚 where economic growth stagnates while inflation remains high, and it鈥檚 a miserable mix that the Federal Reserve has no good tools to fix.
A more encouraging signal arrived Thursday. A report said that the inched lower last week. That鈥檚 a sign that layoffs are potentially remaining low around the country.
Dollar General, meanwhile, reported better profit and revenue for the latest quarter than analysts expected. But the retailer with relatively low prices, whose customers often have the least cushion to absorb higher gasoline prices, gave forecasts for revenue this upcoming year that indicated a potential slowdown in growth. Its stock fell 6.1%.
Some of Wall Street鈥檚 worst losses again hit companies with big fuel bills. Cruise-ship operator Carnival fell 7.9%, and United Airlines sank 4.6%.
Worries about the private-credit industry also continued to hurt the market. Investors have been pulling their money out of some funds and companies that have lent to businesses whose profits are under threat. Many of the worries are focused on business that may not pay back their loans because of competition from AI-powered rivals.
Morgan Stanley fell 4.1% after its North Haven Private Income Fund said it allowed investors to redeem 5% of its total shares instead of the nearly 11% they had requested. That 5% cap is the advertised limit.
All told, the S&P 500 fell 103.18 points to 6,672.62. The Dow Jones Industrial Average dropped 739.42 to 46,677.85, and the Nasdaq composite sank 404.16 to 22,311.98.
In stock markets abroad, indexes fell across Europe and Asia.
Japan鈥檚 Nikkei 225 dropped 1%, and France鈥檚 CAC 40 sank 0.7% for two of the world鈥檚 bigger moves.
In the bond market, Treasury yields continued to climb because of upward pressure from rising oil prices. The yield on the 10-year Treasury rose to 4.26% from 4.21% late Wednesday and from just 3.97% before the war started.
Higher yields make all kinds of borrowing more expensive, such as for potential U.S. homebuyers and bond offerings for companies looking to expand. They also push down on prices for all kinds of investments, from stocks to crypto.
Because of the spike for oil prices, traders have pushed back forecasts for when the Fed could resume its cuts to interest rates. President Donald Trump has been angrily calling for such cuts, which would give the economy and job market a boost but also potentially worsen inflation.
A barrel of benchmark U.S. crude rose 9.7% to settle at $95.73.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
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An earlier version of the story incorrectly reported the percentage drop for United Airlines鈥� stock.
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