US Equity Indexes Drop as Peace Talks Stall Amid Strikes Between Washington, Tehran

US equity indexes fell while crude oil futures rose as fresh fighting in the Middle East derailed progress in peace talks between Washington and Iran.

The Nasdaq Composite dropped 0.7% to 26,902.1 ahead of Wednesday's close. The Dow Jones Industrial Average fell 1% to 50,806.2, and the S&P 500 slid 0.5% to 7,569.9.

No progress has been made in peace negotiations, Al Jazeera cited Iran's Foreign Minister Abbas Araghchi as saying, referring to the talks between Tehran and Washington. The contact with the United States has not been cut off, Araghchi reportedly said.

The US and Iran exchanged heavy fire on Tuesday evening after the US struck an empty oil tanker it said was attempting to breach its blockade, according to The Wall Street Journal. That set off a string of attacks by both sides, with Iran striking US bases in Kuwait and Bahrain, the WSJ reported.

Kuwait came under a barrage of ballistic missiles and drones on Wednesday that shut its international airport, killed one person, and injured dozens more, the WSJ said. Iran's Revolutionary Guard said retaliatory strikes "should serve as a lesson" for the US, according to a report from Al Jazeera.

Brent crude futures marched 2.1% higher to $97.97, and West Texas Intermediate crude oil futures added 2.5% to $96.06.

Economic Activity Rose at 'Slight to Moderate' Pace in Most Fed Districts, Beige Book Shows

US economic activity increased at "a slight to moderate" pace in 10 of the 12 Federal Reserve districts since mid-April, though underlying signs were less encouraging, the Fed's latest Beige Book released Wednesday showed.Consumer spending remained mixed and increasingly split across income groups, with higher-income households staying resilient, middle-income consumers becoming more cautious, and low-income households showing the most strain, the report said.Districts reported increased credit-card usage, fewer retail visits, and stronger demand for necessities. Auto demand softened due to affordability and fuel costs, while manufacturing activity rose at a modest to strong pace in nine districts.Business outlooks pointed to little change over the next six months amid elevated uncertainty. Employment was largely flat across 11 districts, and wage growth remained "modest to moderate." Districts described a "low-hire, low-fire" environment, with workers reluctant to change jobs.Prices increased at a "moderate to strong" pace overall, driven by energy-related costs tied to the conflict in the Middle East, with spillovers into shipping, packaging, groceries and fertilizer. Firms' ability to pass on higher costs remained mixed, particularly among consumer-facing businesses, the Beige Book said.The report was compiled by the Kansas City Fed using data collected on or before May 27.

Daily Roundup of Key US Economic Data for June 3

ADP private payrolls rose by 122,000 in May, led by a 57,000 gain in education and health services jobs and a 36,000-jobs gain in trade, transportation and utilities.The ISM's services index rose to 54.5 in May from 53.6 in April, with gains in the readings for production, new orders and prices, but a decline for the employment reading.The S&P Global nonmanufacturing index was revised lower in May to 50.7 from the flash 50.9 estimate and was still below the 51.0 reading in April.Factory new orders rose by 4.8% in April with transportation orders up 21.6% and the remaining categories combining for a 1.3% gain.Durable goods orders were revised up to an 8% gain, while nondurable goods new orders rose by 1.4%.Factory shipments increased by 1% and factory inventories rose by 0.3%. When combined with already-published advance estimates for retail and wholesale inventories, business inventories are on pace for a 0.5% gain in the month.The Mortgage Bankers Association reported a 2.5% decline in mortgage applications in the week ended May 29, continuing a string of weekly declines. Refinancing activity and new home applications both declined even as mortgage rates moved lower.Total crude oil inventories fell by 16 million barrels in the week ended May 29, with commercial oil inventories down 8million barrels and stocks in the US Strategic Petroleum Reserve down 8 million barrels. Gasoline inventories and distillate inventories both increased last week.

US Equity Indexes Drop as Peace Talks Stall Amid Strikes Between Washington, Tehran

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Economic Activity Rose at 'Slight to Moderate' Pace in Most Fed Districts, Beige Book Shows

Daily Roundup of Key US Economic Data for June 3

Little to No Change in Employment, Prices Rose at 'Moderate to Strong Pace Overall,' Beige Book Shows

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International4h ago
Economic Activity Rose at 'Slight to Moderate' Pace in Most Fed Districts, Beige Book Shows
US economic activity increased at "a slight to moderate" pace in 10 of the 12 Federal Reserve districts since mid-April, though underlying signs were less encouraging, the Fed's latest Beige Book released Wednesday showed.Consumer spending remained mixed and increasingly split across income groups, with higher-income households staying resilient, middle-income consumers becoming more cautious, and low-income households showing the most strain, the report said.Districts reported increased credit-card usage, fewer retail visits, and stronger demand for necessities. Auto demand softened due to affordability and fuel costs, while manufacturing activity rose at a modest to strong pace in nine districts.Business outlooks pointed to little change over the next six months amid elevated uncertainty. Employment was largely flat across 11 districts, and wage growth remained "modest to moderate." Districts described a "low-hire, low-fire" environment, with workers reluctant to change jobs.Prices increased at a "moderate to strong" pace overall, driven by energy-related costs tied to the conflict in the Middle East, with spillovers into shipping, packaging, groceries and fertilizer. Firms' ability to pass on higher costs remained mixed, particularly among consumer-facing businesses, the Beige Book said.The report was compiled by the Kansas City Fed using data collected on or before May 27.

International4h ago
Daily Roundup of Key US Economic Data for June 3
ADP private payrolls rose by 122,000 in May, led by a 57,000 gain in education and health services jobs and a 36,000-jobs gain in trade, transportation and utilities.The ISM's services index rose to 54.5 in May from 53.6 in April, with gains in the readings for production, new orders and prices, but a decline for the employment reading.The S&P Global nonmanufacturing index was revised lower in May to 50.7 from the flash 50.9 estimate and was still below the 51.0 reading in April.Factory new orders rose by 4.8% in April with transportation orders up 21.6% and the remaining categories combining for a 1.3% gain.Durable goods orders were revised up to an 8% gain, while nondurable goods new orders rose by 1.4%.Factory shipments increased by 1% and factory inventories rose by 0.3%. When combined with already-published advance estimates for retail and wholesale inventories, business inventories are on pace for a 0.5% gain in the month.The Mortgage Bankers Association reported a 2.5% decline in mortgage applications in the week ended May 29, continuing a string of weekly declines. Refinancing activity and new home applications both declined even as mortgage rates moved lower.Total crude oil inventories fell by 16 million barrels in the week ended May 29, with commercial oil inventories down 8million barrels and stocks in the US Strategic Petroleum Reserve down 8 million barrels. Gasoline inventories and distillate inventories both increased last week.

International4h ago
Little to No Change in Employment, Prices Rose at 'Moderate to Strong Pace Overall,' Beige Book Shows