Major U.S. stock indexes dropped as Iranian drone strikes on Kuwait's main international airport and ongoing military exchanges between the United States and Iran drove investors toward safer assets. The Dow Jones Industrial Average fell 619 points, while the S&P 500 snapped a nine-day winning streak. The Nasdaq also declined as technology stocks pulled back from recent highs.
Oil prices rose toward $100 per barrel as the conflict escalated. Iranian drones targeted Kuwait's primary international airport, and the United States and Iran exchanged strikes in the region. The military actions increased concerns about potential disruptions to oil supplies from the Middle East, pushing energy prices higher throughout the trading session.
Treasury yields also rose as investors reassessed risk in their portfolios. The combination of higher oil prices and increased borrowing costs pressured stock valuations, particularly in sectors sensitive to energy costs and interest rates. Technology companies, which had recently driven market gains, saw notable declines despite continued strong demand in artificial intelligence and data center businesses.
The market decline marked a shift from recent optimism that had pushed indexes to record levels. Broadcom and other technology stocks hit new highs earlier in the session on earnings reports and AI infrastructure demand, but broader market concerns overtook sector-specific strength. Wall Street analysts noted that geopolitical tensions added uncertainty to an already complex investment environment.
The downturn reflected immediate investor reactions to military conflict in a region critical to global energy supplies. Markets had been trading near record levels before the Iran strikes, supported by strong corporate earnings and expectations for continued economic growth. The abrupt reversal highlighted how quickly geopolitical events can shift market sentiment and create volatility across asset classes.