Wall Street recovers much of an early loss amid soaring oil prices, Middle East conflict

Wall Street’s key stock indices recovered much of an early loss on Monday, as soaring oil prices heightened inflation worries amid the raging Middle East conflict.

As of 1:04 p.m. Eastern Time, the S&P 500 fell 0.3%, the Dow Jones Industrial Average was down 0.7%, and the Nasdaq Composite gained 0.1%.

As of 11:30 a.m. Eastern Time, the S&P 500 fell 0.5%, the Dow Jones Industrial Average was down 0.8%, and the Nasdaq Composite was 0.1% lower.

As of 9:35 a.m. Eastern Time, the S&P 500 fell 1%, the Dow Jones Industrial Average was down 1.2%, and the Nasdaq Composite was 0.8% lower.

At the start of Monday, the cost of a barrel of Brent crude, the global benchmark, momentarily hit $119.50. If petroleum costs remain elevated for an extended duration, family finances already burdened by severe inflation might collapse under the strain.

"We're being dragged around by events in the Middle East and the price of oil," said Steve Sosnick of Interactive Brokers, according to AFP.

"The longer this goes, the bigger the economic impact and the harder it is to recover from," added Sosnick.

Following reports that several of the globe’s major economies might synchronize a reaction to the surging price of fuel, oil valuations retracted their massive gains on Monday.

French leader Emmanuel Macron stated on Monday that the G7 would deliberate on a potential discharge of emergency oil stockpiles, as financial officials from the top industrial powers prepared for emergency discussions regarding the Middle East conflict.

A barrel of Brent crude retreated to $102.18 during morning sessions, although that figure remains 10.2% higher than the closing price on Friday.

A slide in equities deepened worldwide on Monday due to disruptions to crude production and supply out of the Gulf regiom.

“The US-Iran War is testing energy-shock resiliency,” said Thierry Wizman at Macquarie Group, according to Bloomberg.

“That’s relevant insofar as central bankers will recall that a general burst of commodity price inflation led the consumer inflation burst in 2022,” added Wizman.

In the bond market, benchmark 10-year Treasuries climbed for a sixth straight session, the longest advance since August.

Key Stock Movers

Travel stocks were the hardest hit on Monday. Carnival Corp shares slumped 7.3% and Royal Caribbean Cruises lost 6.3%.

Big banks also declined with Morgan Stanley stock down 2.3% and Citigroup shares falling 3%.

Defense stocks bucked the trend, with Smith & Wesson and Kratos rising about 2% each.

Shares of miners Endeavour Silver and Barrick Mining dropped more than 4% each.

Bullion Market

Gold prices shed more than 1% on Monday on a stronger American dollar amid uncertainty over the West Asia war.

The US dollar climbed against most major currencies.

At 9:11 a.m. ET (1311 GMT), spot gold slid 1.5% at $5,092.89 per ounce. US gold futures for April delivery dropped 1.1% to $5,101.00.

Among other metals, spot silver fell 0.3% at $84.08 per ounce, platinum gained 0.3% to $2,141.38 and palladium added 0.8% to $1,638.75.