Wall Street flipped into the red Wednesday afternoon after news broke that the U.S. is pulling some embassy staff from multiple Middle Eastern countries, a move that reignited geopolitical fears.
Just after 3:00 p.m. ET, several news outlets, including the Associated Press, reported that the U.S. State Department had ordered all nonessential personnel to leave the embassy in Baghdad while authorizing voluntary departures in Bahrain and Kuwait.
Though the Baghdad Post was already operating with limited staff, the latest move raised eyebrows among investors.
Markets Flip, Gold And Oil Prices Rise
Stocks edged higher early Wednesday, helped by a softer-than-expected inflation report and President Donald Trump‘s upbeat trade talk, which hinted at progress in a trade deal with China.
Traders rotated out of equities and into safe-haven assets as the embassy developments stirred geopolitical concerns.
The market reaction was swift. The Dow Jones Industrial Average gave up nearly 300 points from its earlier peak of 43,115, dipping to 42,860 late in the session.
The S&P 500 fell about 50 points to close at the 6,020 level, while the Nasdaq 100 slid to 21,860 from a session high of 22,000.
S&P 500’s top daily performers on Wednesday were Starbucks Corp. SBUX and Palantir Technologies Inc. PLTR, up 4.1% and 3.9%, respectively. Major laggards were Intel Corp. INTC and Nucor Corp. NUE down 6.1% and 5.3%, respectively.
Gold prices – as tracked by the SPDR Gold Trust GLD – climbed 0.7% to $3,345 an ounce, drawing safe-haven demand. Oil witnessed a strong rally, with crude prices jumping 4.3% to break above $67 a barrel—the biggest one-day gain since April 9 and second-strongest since October 2024.
Iran Nuclear Tensions Add Fuel
Tensions between Washington and Tehran have risen in recent days as nuclear talks stall ahead of a sixth round of negotiations, tentatively set for Sunday, June 15 in Oman.
The U.S. is standing firm against Iran’s efforts to enrich uranium and develop nuclear weapons. Iran, in turn, has labeled any enrichment ban as unacceptable and is demanding real sanctions relief before making any concessions.
As Reuters reported Wednesday, Iran’s Defense Minister threatened possible strikes on U.S. bases if the talks break down and conflict erupts.
Read Next:
Photo: Angela N Perryman/Shutterstock
Add Comment