NEW YORK: Wall Street stocks dipped early Monday ahead of US inflation data as markets looked ahead to this week’s China visit by US President Donald Trump and Iran war developments.
Oil prices climbed after Trump rejected Iran’s latest counteroffer to a US peace proposal, which leaves the Strait of Hormuz mostly closed to oil tanker traffic.
About 10 minutes into trading, the Dow Jones Industrial Average was down 0.1 percent at 49,586.40.
The broad-based S&P 500 was unchanged at 7,398.19, while the tech-rich Nasdaq Composite Index dipped 0.2 percent to 26,184.07.
With the bulk of earnings season now complete, markets will turn the focus to key US inflation and retail sales reports this week.
Stocks remain near records on enthusiasm about artificial intelligence advances that has offset concerns about higher oil prices.
But the Iran war remains a point of worry.
“We’re in the eighth week of elevated energy prices, and the longer that lasts, the greater a chance that cuts economic activity,” said Art Hogan of B. Riley Wealth Management.
I’m not surprised stocks are dipping—Trump rejecting Iran’s counteroffer just keeps the Strait of Hormuz mess going, and oil prices climbing is bad news for everyone.
Art Hogan’s point about eight weeks of elevated energy prices really hits home. How long before higher oil starts hurting consumer spending and corporate profits?
With the Dow down only 0.1%, it’s barely a blip. AI hype is still carrying the market, but I’m worried the Iran situation could turn into a bigger drag.
Interesting that the S&P is flat while Nasdaq is down a bit. Tech might be taking a breather ahead of the inflation report—everyone’s watching for any surprise.
The war mentioned here in Hormuz involving China and US and Iran is significant. The impact on the ground will depend on how this unfolds.
Trump’s trip to China this week could shake things up too. If he announces a trade deal, it might offset the oil worries, but I’m not holding my breath.