This Week on Wall Street

Wall Street closed sharply lower Tuesday as the U.S.-Iran conflict escalated again, with the S&P 500 down 0.71% to 7,631.47, the Nasdaq Composite down 1.03% to 26,099.77 and the Dow Jones down 0.79% to 52,766.88, giving back a chunk of August's gains. Crude jumped after more tankers came under fire near the Strait of Hormuz, with Brent crude near $95.54 a barrel and WTI holding above $87, and reports Wednesday morning of fresh U.S. strikes on Iranian rocket launchers and Iranian retaliation against American bases kept oil bid into the new session. Energy was the lone standout, up about 1.3% Tuesday, while Consumer Discretionary led decliners, down 1.9% as travel, leisure and retail names slid to fresh 52-week lows — only four of the eleven S&P sectors closed in the green. The 10-year Treasury yield climbed to 4.79%, its highest since January 2025, as the oil shock stoked inflation worries ahead of a Sept. 16 Fed decision markets now see as roughly a coin-flip for a hike following Chair Warsh's hawkish Jackson Hole remarks. The VIX jumped 9.5% to 16.34 on surging hedging demand, while gold slipped further to around $4,360 an ounce — nearly 9% off its three-month high — as the firmer-for-longer rate outlook continues to outweigh Middle East safe-haven flows. Wednesday's session opens with ADP's private payrolls report ahead of Friday's closely watched August jobs data.