US stock indices moved lower on Thursday as rising oil prices and higher Treasury yields renewed concerns about inflation and geopolitical tensions, while investors evaluated whether Nvidia delivered enough upside to justify its elevated valuation after another strong earnings report.
The S&P 500 fell 0.48%, while the Nasdaq Composite declined 0.56%. The Dow Jones Industrial Average dropped about 242 points, or 0.49%.
The market pullback followed renewed tensions involving Iran after a Reuters report said Iran’s Supreme Leader Ayatollah Mojtaba Khamenei directed that enriched uranium remain inside the country, complicating hopes for progress in negotiations with the United States.
The report reversed some of the optimism seen on Wednesday, when equities rallied after President Donald Trump said negotiations with Iran were in the “final stages.”
Oil and treasury yields climb again
Crude prices jumped sharply following the Reuters report, intensifying investor concerns that prolonged geopolitical instability could keep inflation elevated.
West Texas Intermediate crude futures rose 2.9% to $101.04 per barrel, while Brent crude gained 2.3% to $107.36 a barrel.
The rise in oil prices pushed Treasury yields higher as markets reassessed the inflation outlook.
The benchmark 10-year Treasury yield climbed roughly 5 basis points to 4.615%, while the 30-year Treasury yield also moved higher.
Investors have increasingly worried that higher energy prices and continued disruption around the Strait of Hormuz could fuel inflationary pressures and complicate the Federal Reserve’s policy path.
Economic data released Thursday offered fresh insight into the strength of the US economy, as weekly jobless claims showed the labor market remained relatively stable despite growing concerns over inflation pressures linked to the conflict between Israel and Iran.
Nvidia results fail to fully impress investors
Investors also focused heavily on Nvidia after the AI chipmaker reported quarterly results that exceeded Wall Street expectations and announced an $80 billion share repurchase authorization.
The company also raised its quarterly cash dividend to 25 cents per share and projected second-quarter revenue above analyst forecasts.
Despite the strong report, Nvidia shares traded slightly lower as investors questioned whether the company could continue sustaining its rapid pace of growth amid rising competition.
Competition in artificial intelligence chips has intensified as rivals, including Intel and Advanced Micro Devices, continue expanding their AI offerings.
Retail and quantum stocks move sharply
Elsewhere, Walmart shares fell after the retailer maintained its full-year guidance but forecast second-quarter profit below Wall Street estimates.
Intuit dropped sharply after lowering its annual revenue forecast for TurboTax and announcing plans to cut 17% of its workforce.
Quantum computing stocks rallied after a Wall Street Journal report said the Trump administration planned to award $2 billion in grants to several quantum technology firms.
IBM rose after the report indicated it could receive roughly $1 billion in funding.
Shares of GlobalFoundries, D-Wave Quantum, and Rigetti Computing also posted strong gains.
Investors were also monitoring SpaceX after the company publicly filed for its initial public offering, offering new details about Elon Musk’s broader artificial intelligence ambitions.
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