Wall Street indices opened in the red on Wednesday, dragged by US President Donald Trump's latest comments on the Iran and inflation reaching a three-year high.
The S&P 500 opened 0.50% lower at 7,349.44, tech-heavy Nasdaq Composite was down 0.7% or over 176 points to 25,502.18, and the Dow Jones Industrial Average lost over 230 points to open 0.46% lower at 50,637.16.
As of 10:15 a.m. EST, S&P 500 and Nasdaq traded 0.15% lower at 7,375.35 and 25,656.47 respectively, while Dow traded 0.46% lower at 50,630.15.
Major chip stocks like Nvidia Corp. and Micron Technology Inc. resumed their rout and traded 1.37% and 1.52% lower at $205.4 and $920.97, respectively.
ALSO READ: US Inflation Soars To Three-Year High As Iran War Pushes Up Energy Prices
Renewed aggressions between America and Iran are weighing on the markets as Trump has said that he is "close to ordering strikes on Iran". He also accused Iran of taking too long to negotiate, for which he said, it will have to "pay the price."
Oil prices climbed immediately after this statement, with Brent Crude touching an intraday high of $93.4 per barrel and West Texas Intermediate reaching $90.8 per barrel. As of 10:06 p.m. Brent Crude traded 1.5% higher at $92.81/barrel and WTI was up 2% to $89.8 per barrel.
Besides this, even as the US CPI touched a 3-year high, topping 4% in the month of may, the core gauge- which excludes food and energy and reveals the long-term inflation picture- showed only a modest growth of 0.2% from April and 2.9% from a year earlier.
"Overall, while the pace of headline inflation was driven higher by gasoline and energy prices, the core figures were benign — suggesting that the Fed has plenty of capacity for patience during the next several meetings," Ian Lyngen at BMO Capital Markets told Bloomberg.
ALSO READ: Gold, Silver ETFs Tumble Up To 5% As Bears Dominate Precious Metals Market
After the markets opened, six out of the 11 sectoral indices traded in the red while five traded in the green. Gains were led by the consumer staples and energy sectors, whereas the consumer discretionary and industrials sector led the decline.
Apart from this, Spot gold prices also slipped over 2% to a low of $4,131.61 an ounce.
The Dollar Spot Index fell 0.2% while the euro rose 0.2% to $1.156, British pound rose 0.3% to $1.3416, and the Japanese yen was little changed at 160.38 per dollar.
Bitcoin, the largest traded cryptocurrency, rose 0.2% to $62,210.4.
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