WASHINGTON (dpa-AFX) - Stocks showed a lack of direction early in the session on Wednesday but came under considerable selling pressure over the course of the trading day. The major averages all showed significant moves to the downside.
The major averages ended the day just off their lows of the session. The Dow tumbled 953.33 points or 1.9 percent to 49,918.78, the Nasdaq plunged 509.32 points or 2 percent to 25,169.50 and the S&P 500 slumped 119.66 points or 1.6 percent to 7,266.99.
The weakness that emerged On Wall Street came as President Donald Trump ramped up his threats against Iran following a recent exchange of attacks.
'We hit them hard yesterday, and we're going to hit them hard again today,' Trump told reporters at the White House. 'We're going to be attacking them and attacking them very hard.'
Trump's latest threats came after U.S. Central Command said forces completed 'self-defense strikes' against Iran on Tuesday at the president's direction in response to the downing of a U.S. helicopter.
CENTCOM said forces struck Iranian air defense, ground control stations, and surveillance radar sites near the Strait of Hormuz with precision munitions from U.S. Air Force and Navy fighter jets.
In retaliation, Iran reportedly attacked U.S. bases in Kuwait, Bahrain and Jordan and vowed it would leave no attack or threat unanswered.
Trump said in a subsequent post on Truth Social this morning that Iran has 'taken too long to negotiate a deal' and will now have to 'pay the price!'
Concerns about a re-escalation of the Middle East conflict contributed to a surge by the price of crude oil, as traders shrugged off Trump's claims that the U.S. has secretly helped move more than 100 million barrels of oil through the Strait of Hormuz.
On the inflation front, the Labor Department released a report showing consumer prices in the U.S. increased in line with economist estimates in the month of May.
The Labor Department said its consumer price index rose by 0.5 percent in May after climbing by 0.6 percent in April. The price growth matched expectations.
The annual rate of consumer price growth accelerated to 4.2 percent in May from 3.8 percent in April, which was also in line with estimates.
The report also said core consumer prices, which exclude food and energy prices, crept up by 0.2 percent in May after rising by 0.4 percent in April. Economists had expected core prices to increase by 0.3 percent.
The annual rate of core consumer price growth inched up to 2.9 percent in May from 2.8 percent in April, which matched expectations.
Sector News
Airline stocks moved sharply lower amid the surge by the price of crude oil, resulting in a 5.4 percent nosedive by the NYSE Arca Airline Index.
Substantial weakness was also visible among gold stocks, which moved lower along with the price of the precious metal, dragging the NYSE Arca Gold Bugs Index down by 5 percent.
Computer hardware, semiconductor and housing stocks also saw significant weakness on the day, while energy stocks bucked the downtrend.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index tumbled by 1.9 percent, while China's Shanghai Composite Index fell by 0.4 percent.
Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index rose by 0.3 percent, the French CAC 40 Index slid by 0.5 percent and the German DAX Index slumped by 1 percent.
In the bond market, treasuries moved to the downside over the course of the session. As a reuslt, the yield on the benchmark ten-year note, which moves opposite of its price, ticked up by 1.4 basis points to 4.542 percent.
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