WASHINGTON (dpa-AFX) - Stocks moved mostly lower over the course of the trading session on Wednesday, giving back ground after trending higher over the past several sessions. The major averages all moved to the downside, with the Dow showing a notable slump.
The Dow showed a downward move going into the end of the day, closing down 620.72 points or 0.7 percent at 50,687.07. The Nasdaq also slid 239.93 points or 0.9 percent to 26,853,98, while the S&P 500 fell 56.10 points or 0.7 percent to 7,553.68.
The pullback on Wall Street came amid uncertainty about the situation in the Middle East, as negotiations between the U.S and Iran continue to drag on.
U.S. Central Command said U.S. forces successfully defeated multiple Iranian ballistic missiles and drones and conducted 'self-defense' strikes on Qeshm Island in response to attempted attacks by Iran on Tuesday.
The ongoing military exchanges have contributed to a sharp increase by the price of crude oil, with U.S. crude oil futures surging by more than 2 percent.
However, stocks have recently been able to shrug off concerns about the war amid persistent optimism about strong earnings and resilient economic growth.
'For now, risk appetite remains supported, but with stretched valuations and shifting monetary policy expectations, markets appear increasingly sensitive to any signs that the earnings and growth story may begin to soften,' said Daniela Hathorn, Senior Market Analyst at Capital.com.
In U.S. economic news, the Institute for Supply Management released a report showing its reading on U.S. service sector activity increased by more than expected in the month of May.
The ISM said its services PMI rose to 54.5 in May from 53.6 in April, with a reading above 50 indicating growth. Economists had expected the index to tick up to 53.7.
Sector News
Software stocks showed a substantial move to the downside on the day, with the Dow Jones U.S. Software Index diving by 4 percent.
A decrease by the price of gold also weighed on gold stocks, as reflected by the 3.6 percent plunge by the NYSE Arca Gold Bugs Index.
Telecom, airline and networking stocks also saw significant weakness, while strength among biotechnology, oil and semiconductor stocks helped limit the downside for the markets.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Wednesday. Japan's Nikkei 225 Index surged by 2.5 percent, while Hong Kong's Hang Seng Index tumbled by 1.6 percent.
Meanwhile, the major European markets all moved to the downside on the day. While the German DAX Index slumped by 1.3 percent, the French CAC 40 Index slid by 0.7 percent and the U.K.'s FTSE 100 Index fell by 0.4 percent.
In the bond market, treasuries moved lower amid the sharp increase by the price of crude oil. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 3.6 basis points to 4.491 percent.
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