US-Iran clashes lift oil; S&P 500 ends nine-day streak

Overnight clashes between U.S. and Iranian forces that involved Kuwait and Bahrain pushed West Texas Intermediate crude to $96.20 a barrel and ended the S&P 500’s nine-day winning streak, prompting risk-off trading across global markets.

The exchanges, described as one of the most serious since an early-April ceasefire, disrupted security in the Gulf and raised concerns about access to the Strait of Hormuz. Brent briefly topped $97 a barrel and WTI gained about 2.8%.

U.S. equity indexes moved lower: the S&P 500 fell 0.7%, the Dow lost 1.2% and the Nasdaq 100 slipped 0.3%. Software-focused exchange-traded funds dropped more than 4%. The MSCI World Index closed down 0.7% after earlier reaching record highs.

Technology-sector news contributed to the sell-off. Broadcom issued weaker-than-expected forward guidance, affecting AI infrastructure revenue expectations. Alphabet completed an upsized $84.75 billion equity sale and SpaceX announced a planned $75 billion initial public offering at $135 per share.

In fixed income, the U.S. 10-year Treasury yield rose five basis points to 4.49%. Germany’s 10-year yield increased six basis points to 3.04% and Britain’s 10-year yield climbed seven basis points to 4.93%.

Currency and commodity moves reflected safe-haven flows and higher rate expectations. The U.S. Dollar Index strengthened 0.3%, the euro traded near $1.1598 and the pound near $1.3420. Spot gold fell about 1.2%.

Asian markets opened lower in line with U.S. weakness. The Nikkei 225 declined 1.4%, the KOSPI and Hang Seng each lost 1.5%, China A50 fell 1.5% and the CSI 300 was down 0.8%. Australia’s ASX 200 and Singapore’s STI each dropped about 1.2%.

The Japanese yen traded near a multi-decade low around 160.08 per dollar, with a short-term support level at 159.45 noted by market participants.

Oil technicals showed WTI holding above a near-term support at $95.10 a barrel. A sustained move above $100, which aligns with the 20- and 50-day moving averages, would put resistance targets near $102.56 and $106.70. An hourly close below $95.10 would expose supports at $91.40 and $89.00.

Markets have priced a more hawkish outlook for central banks, with expectations shifting toward a Federal Reserve rate increase and near certainty of a 25 basis-point European Central Bank hike at the June 11 meeting. Traders will monitor remarks by ECB President Christine Lagarde, U.S. initial and continuing jobless claims, a speech by Fed official Thomas Barkin and comments from Bank of England Governor Andrew Bailey for further market direction.