FINWIRES · TerminalLIVE
FINWIRES

Update: US Equity Indexes Sink as Mag-7 Stalwarts Disappoint, Houthis Attack Saudi Tankers in Red Sea

By

US equity indexes dropped as shares of mega-caps Alphabet (GOOG, GOOGL) and Tesla (TSLA) sank and government bond yields surged with crude oil after Iran-aligned Houthis attacked Saudi Arabian tankers in the Red Sea.

The Nasdaq Composite slumped 2.4% to 25,067.2, the S&P 500 dropped 1.3% to 7,402.7, and the Dow Jones Industrial Average declined 1% to 51,708.5.

Tesla (TSLA) shares fell 14%, the worst performer in the S&P 500 and the Nasdaq, after the firm reported a steeper-than-expected drop in Q2 adjusted earnings. Gross and operating margins missed consensus "considerably," and "more important aspects are an increase in capital investments and operating expenses related to the AI transition," Truist Securities said in a note. Free cash flow turned negative in Q2, with an outflow of $1.1 billion.

The European Commission fined Alphabet's (GOOG, GOOGL) Google 890 million euros ($1.04 billion) after the company violated the Digital Markets Act through self-preferencing in Google Search and anti-steering practices on Google Play. Shares slumped 7.1%, among the steepest decliners on the S&P 500, the Nasdaq, and the Dow.

In geopolitical news, Iran flew Islamic Revolutionary Guard Corps (IRGC) commanders, military advisers, and missile- and drone-related equipment into Yemen this month, according to four sources, in a move that suggests Tehran is seeking to strengthen the ability of its Houthi allies to threaten Red Sea shipping, Reuters reported.

Houthi rebels said they attacked two Saudi Arabian oil tankers in the Red Sea on Thursday, according to a report from the Associated Press, widening the disruption to crude oil supplies from the Middle East.

The front-month US West Texas Intermediate soared 5.6% to $91.70 a barrel, and global benchmark North Sea Brent spiked 6.8% to $100.42 a barrel.

US Treasury yields jumped, extending gains. The 10-year marched 4.8 basis points higher to 4.71% after touching its highest in 52 weeks intraday. The two-year surged six basis points to 4.36% after yields hit a fresh 52-week high this week.

Related Articles

Japan

US Equity Markets Close Lower as Escalating Middle East Tensions Lift Oil Prices

US equity indexes ended lower Wednesday as US-Iran tensions continued to escalate, boosting crude oil prices.* The US will destroy an Iranian bridge or power plant, including those in and around Tehran, every time it attacks ships in the Strait of Hormuz, President Donald Trump said in a social media post. In a post on X, Iran's Foreign Minister Abbas Araghchi said, "Our defense doctrine is clear: eye for an eye."* The probability of the Federal Reserve raising the policy rate for July increased to 33.7% from 10.7% a week ago, according to the CME FedWatch tool.* August West Texas Intermediate crude oil rose $2.24 to settle at $86.62 per barrel, while September Brent crude, the global benchmark, was last seen up $2.88 at $93.92.* Super Micro Computer (SMCI) shares rose 20%, the top gainer on the S&P 500, a day after the company said it expects fiscal Q4 GAAP and non-GAAP gross margins in the range of 15% to 17%, above its 8.2% to 8.4% forecast.* Space Exploration Technologies' (SPCX) SpaceXAI unit is exploring several potential sites in Texas for at least one new large-scale data center, The Information reported. The stock fell 6.7%, the biggest drop on the Nasdaq.

Dow JonesNasdaq CompositeS&P 500$SMCI$SPCX
Japan

Update: US Equity Indexes Mixed as Crude Oil Jumps While Investors Await Alphabet, Tesla's Earnings

(Updates with index/price moves and company/geopolitical news from the first paragraph.)US equity indexes traded mixed as government bond yields followed crude oil prices higher and investors awaited quarterly results from mega-caps Alphabet (GOOG, GOOGL) and Tesla (TSLA).The Nasdaq Composite fell 0.3% to 25,756.3 ahead of Wednesday's close. The S&P 500 slipped less than 0.1% to 7,507.8, while the Dow Jones Industrial Average leaned slightly higher to 52,254.6.Alphabet and Tesla, both a part of the so-called Magnificent-7 group of stocks with a significant index sway, will report after the bell on Wednesday.In geopolitical news, the US will destroy an Iranian bridge or power plant, including those in and around Tehran, every time it attacks ships in the Strait of Hormuz, President Donald Trump said in a social media post on Wednesday.Iran's Foreign Minister Abbas Araghchi posted on X, formerly Twitter, saying "our defense doctrine is clear: eye for an eye.""Any aggression against Iran, including our infrastructure, will compel a powerful and decisive response," he posted on Wednesday. "Those who contribute to such aggression, whatever the kind of support, will also be considered as legitimate targets."Seven tankers have changed course in the Red Sea to avoid the Bab el-Mandeb Strait since the Houthis' threat on Tuesday to block Saudi oil exports, Reuters reported. The Iran-aligned Houthis have reportedly completed preparations to target vessels near the Bab el-Mandeb Strait, which connects the Red Sea to the Gulf of Aden and Arabian Sea. The Bab el-Mandeb Strait is an alternative route to the Strait of Hormuz, which remains effectively closed due to tensions between the US and Iran.The front-month US West Texas Intermediate climbed 3.1% to $86.97 a barrel, and global benchmark North Sea Brent jumped 3.5% to $94.22 a barrel.US Treasury yields rose, extending gains from Tuesday. The 10-year marched 3.1 basis points higher to 4.66%, its strongest level in a month. The two-year jumped 4.1 basis points to 4.3% after yields hit the highest in 52 weeks.

Dow JonesNasdaq CompositeS&P 500$GOOG$GOOGL$TSLA
Japan

US Equity Indexes Mixed Amid Higher Crude Oil Prices, Treasury Yields

(Updates with index/price moves and company/geopolitical news from the first paragraph.)US equity indexes traded mixed ahead of quarterly earnings from Alphabet (GOOG, GOOGL) and Tesla (TSLA) and as government bond yields followed crude oil prices higher amid worsening Iran geopolitics.The Nasdaq Composite slipped less than 0.1% to 25,826.1 after midday Wednesday. The S&P 500 rose 0.1% to 7,519.5, and the Dow Jones Industrial Average climbed 0.3% to 52,369.4.Alphabet and Tesla will report quarterly earnings after the bell on Wednesday.In geopolitical news, the US will destroy an Iranian bridge or power plant, including those in and around Tehran, every time it attacks ships in the Strait of Hormuz, President Donald Trump said in a social media post on Wednesday.Four more tankers changed course in the Red Sea Wednesday following threats by Yemen's Iran-aligned Houthis to attack vessels using Saudi Arabian ports, Reuters reported. The Houthis have reportedly completed preparations to target vessels near the Bab el-Mandeb Strait, which connects the Red Sea to the Gulf of Aden and Arabian Sea. The Bab el-Mandeb Strait is an alternative route to the Strait of Hormuz, which remains effectively closed due to tensions between the US and Iran.The front-month US West Texas Intermediate climbed 3.3% to $86.83 a barrel, and global benchmark North Sea Brent jumped 3.3% to $94.02 a barrel.US Treasury yields rose, extending gains from Tuesday. The 10-year marched 2.6 basis points higher to 4.65%, its strongest level in a month. The two-year jumped 4.3 basis points to 4.3%, after yields hit the highest in 52 weeks.

Dow JonesNasdaq CompositeS&P 500$GOOG$GOOGL$TSLA