WASHINGTON (dpa-AFX) - After moving moderately lower over the two previous sessions, stocks showed a more significant move to the downside during trading on Tuesday. The major averages all moved notably lower, with the tech-heavy Nasdaq leading the way.
The major averages ended the day off their lows of the session but still firmly negative. The Nasdaq slumped 271.11 points or 1 percent to 26,099.77, the Dow slid 419.02 points or 0.8 percent to 52,766.88 and the S&P 500 fell 54.67 points or 0.7 percent to 7,631.47.
The continued weakness on Wall Street came after U.S. Central Command announced a fresh wave of attacks against Iran, striking Islamic Revolutionary Guard Corps targets.
Centcom said the strikes follow recent attempted attacks by the IRGC against commercial shipping in the Strait of Hormuz and against American service members deployed to the region.
In a post on Truth Social, President Donald Trump warned Iran would be 'hit again at a much harder and higher level' if they retaliate for the latest attack.
'But it will not be the biggest attack of them all, that is waiting in the wings and, when it is over, there will be very little left of the Islamic Republic of Iran!' Trump said.
Crude oil prices have surged in reaction to the latest attack, with U.S. crude oil futures spiking by more than 5 percent, renewing concerns about inflation and the outlook for interest rates.
Sharply higher crude oil prices weighed on the markets early in the session, but stocks regained some ground after the Institute for Supply Management released a report showing a slowdown in the pace of growth in U.S. manufacturing activity.
The ISM said its manufacturing PMI dipped to 54.6 in August from 55.6 in July, although a reading above 50 still indicates growth. Economists had expected the index to edge down to 55.2.
Ahead of the release of the more closely watched monthly jobs report on Friday, traders may feel signs of economic weakness could keep the Federal Reserve from raising interest rates later this month.
Sector News
Gold stocks moved sharply lower along with the price of the precious metal, resulting in a 4.2 percent nosedive by the NYSE Arca Gold Bugs Index.
Substantial weakness was also visible among networking stocks, as reflected by the 2.6 percent plunge by the NYSE Arca Networking Index.
Transportation stocks also showed a significant move to the downside, dragging the Dow Jones Transportation Average down by 2.5 percent.
Software, housing and semiconductor stocks also saw considerable weakness, while oil producer and pharmaceutical stocks bucked the downtrend.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan's Nikkei 225 Index and China's Shanghai Composite Index both dipped by 0.2 percent, while Hong Kong's Hang Seng Index slid by 0.9 percent.
The major European markets also moved to the downside on the day. While the German DAX Index slumped by 1.1 percent, the French CAC 40 Index fell by 0.4 percent and the U.K.'s FTSE 100 Index declined by 0.3 percent.
In the bond market, treasuries extended a recent downward trend amid the spike in crude oil prices. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, advanced 3.8 basis points to a nearly three-year closing high of 4.796 percent.
Copyright(c) 2026 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2026 AFX News
