NEW YORK (AP) — U.S. stocks pulled back from their record heights on a shaky Wall Street Thursday following mixed profit reports from Tesla and other big companies. Oil prices, meanwhile, jumped on worries about what will happen next in the war with Iran.
The S&P 500 fell 0.4% and halted a weekslong rally that had erased all its losses because of the war and then carried it to all-time highs. The Dow Jones Industrial Average dipped 179 points, or 0.4%, while the Nasdaq composite dropped 0.9% from its own record.
Tesla helped drag the market lower after sinking 3.6% even though it reported better results for the latest quarter than analysts expected. Investors focused instead on a big jump in Tesla’s forecast for spending this year, as it builds factories to make robots and other products.
“You should expect to see a very significant increase in capital expenditures,” Elon Musk told investors late Wednesday, “but I think well justified for a substantially increased future revenue stream.”
ServiceNow dropped even more, 17.7%, even though its results for the latest quarter matched analysts’ expectations. The company has been under pressure, along with much of the broad software industry, because of worries that rivals powered by artificial-intelligence technology could undercut its business.
In the oil market, prices leaped as uncertainty built about what will happen with the Strait of Hormuz. A ceasefire is still in place between the United States and Iran, but oil tankers in the Persian Gulf aren’t able to get through the narrow waterway off Iran’s coast and deliver crude to customers.
The U.S. military on Thursday seized another tanker associated with the smuggling of Iranian oil, a day after Iran’s paramilitary Revolutionary Guards took control of two vessels in the strait. President Donald Trump also said Thursday he ordered the U.S. military to “shoot and kill” Iranian boats that deploy mines to gum up traffic in the strait.
The price for a barrel of Brent crude to be delivered in June rose 3.1% to settle at $105.07 and at one point topped $107. That peak coincided with a sudden drawdown for stocks, and the S&P 500 fell as much as 1.3% before it almost as instantly erased half the loss.
The price for a barrel of Brent to be delivered in July, which is the more popular contract for traders, settled at $99.35 after getting as high as $101.
More expensive oil has hurt airlines in particular because of the industry’s big fuel bills, and stocks diverged in the industry following the latest profit reports.
Source: WPLG
