PiCK
US Stocks Fall on Uncertainty Over Second US-Iran Ceasefire Talks; S&P 500 Loses 0.6%
Summary
- The three major indexes — the Dow, the S&P 500, and the Nasdaq — closed lower as uncertainty deepened over a second round of ceasefire talks between the U.S. and Iran.
- Tensions over the Iran ceasefire sent global oil prices sharply higher, while most sectors declined except energy.
- Hawkish remarks from Fed chair candidate Kevin Warsh pushed U.S. Treasury yields higher, keeping investor sentiment cautious.
Forecast Trend Report by Period
The three major U.S. stock indexes closed lower as uncertainty mounted over a second round of ceasefire talks between the U.S. and Iran.
On April 21, the Dow Jones Industrial Average fell 293.18 points, or 0.59%, to 49,149.38 on the New York Stock Exchange. The S&P 500 dropped 45.13 points, or 0.63%, to 7,064.01, while the tech-heavy Nasdaq Composite lost 144.43 points, or 0.59%, to 24,259.96.
Stocks opened higher after major companies posted solid first-quarter earnings. Those gains later evaporated as reports clouded prospects for a second round of talks between Washington and Tehran. Investor sentiment deteriorated sharply after reports said negotiators from neither country had departed for Islamabad, Pakistan, the meeting site, even as the ceasefire neared expiration.
The mood darkened further after the Pentagon seized a vessel linked to Iran in the Indo-Pacific region. President Donald Trump also told CNBC he had no intention of extending the ceasefire and mentioned bombing Iran if no agreement was reached. Iran pushed back, calling the U.S. maritime blockade an act of war.
Oil prices surged. Brent crude for June delivery settled up $3.00, or 3.14%, at $98.48 a barrel. West Texas Intermediate crude for June delivery rose $2.25, or 2.57%, to $89.67 a barrel.
After the close, however, Trump said he would extend the ceasefire. He said he had been asked to hold off on an attack until Iran's leadership and delegation presented a unified proposal, citing serious divisions within the Iranian government and a request from Pakistan.
Iran also informed the U.S., through Pakistan, that it would not participate in the second round of talks, Tasnim News Agency reported.
Axel Rudolph of trading platform IG said investor sentiment remained cautious because of uncertainty surrounding the Iran ceasefire.
All sectors fell except energy. Among technology companies with market values above $1 trillion, Microsoft, Broadcom and Amazon gained. Apple dropped 2.52% on news that Chief Executive Officer Tim Cook would step down.
Investors also watched a Senate hearing on April 21 for Kevin Warsh, a candidate to chair the Federal Reserve. Warsh said he would preserve the Fed's independence regardless of the president's preference for lower interest rates. The remarks were interpreted as hawkish, sending Treasury yields higher.
The 10-year Treasury yield rose 0.04 percentage point to 4.29%, while the two-year Treasury yield, which is more sensitive to monetary policy, climbed 0.06 percentage point to 3.78%.
Go Jeong-sam, Hankyung.com reporter jsk@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
