US equity indexes fell ahead of the close on Thursday as bond yields and oil prices surged after President Donald Trump warned of extreme economic actions against Iran and any country that supports or conducts business with the Middle East nation.
Bond yields continued to rise despite Treasury Secretary Scott Bessent stating that the buyback of long-dated government debt, which was announced yesterday, could exceed $4 billion, CNBC reported Thursday, citing an interview with the official.
Iran's Foreign Minister Seyed Abbas Araghchi dismissed Trump's warning in an X post, describing it as a diversion from America's challenges of "unprecedented debt & surging interest costs." US debt surpassed $40 trillion, having more than doubled in less than a decade.
The Nasdaq Composite fell 0.9% to 26,074.8, and the S&P 500 declined 0.7% to 7,654.38. The Dow Jones Industrial Average shed 1.1% to 52,849.6. Real estate and energy sectors led the gainers, while consumer staples and health led the decliners.
The yield on 30-year Treasuries rose 3.9 basis points to 5.23%, while the 10-year yield gained 3.9 basis points to 4.69%.
Gold futures gained 0.9% to $4,584.80 per ounce, and silver futures rose 3.6% to $68.96.
In economic news, the Conference Board's measure of leading indicators rose by 0.2% in July, a larger gain than the 0.1% increase expected in a survey compiled by Bloomberg, and following a 0.1% decrease in June.
According to the Labor Department, US initial jobless claims fell to 206,000 in the week ended Aug. 15, from an upwardly revised 212,000 in the week earlier, and were lower than the 210,000 expected in a survey of analysts compiled by Bloomberg.
US natural gas stocks rose by 16 billion cubic feet in the week ended Aug. 14, higher than the 15 billion gain expected in a survey compiled by Bloomberg and following an increase of 36 billion cubic feet in the week prior.
The US West Texas Intermediate crude oil contract rose 2.7% to $88.15 per barrel.
In company news, SpaceX (SPCX) approached Cognition AI for a potential acquisition, but there are currently no active deal talks between the companies. SpaceX and the AI coding startup are also exploring a collaboration, Bloomberg reported late Wednesday, citing people familiar with the matter. SpaceX shares were down 5%.
Walmart (WMT) shares fell 9.7% in Thursday trading after its fiscal 2027 adjusted EPS guidance missed analyst expectations. The company reported fiscal Q2 adjusted earnings of $0.81 per share, up from $0.68 a year earlier and above the FactSet estimate of $0.74. Revenue was $187.94 billion, up from $177.40 billion a year ago and above the FactSet estimate of $186.62 billion. For fiscal 2027, Walmart expects adjusted EPS of $2.80 to $2.87, up from $2.75 to $2.85 earlier, but below the FactSet estimate of $2.90.