US stock market hangs near records and crude oil prices ease
U.S. stocks hovered near record highs on Wednesday as oil prices dropped, easing inflation pressures, with the S&P 500 up 0.1% and the Dow Jones rising 0.3%, while crude oil prices fell amid hopes of a U.S.-Iran agreement on the Strait of Hormuz. AI-driven companies like Micron Technology surged, while oil-and-gas stocks declined, and Treasury yields dipped slightly, offering relief amid concerns over borrowing costs for AI infrastructure.
U.S. stock markets remained near record levels Wednesday as falling crude oil prices reduced pressure on households and businesses globally. The S&P 500 rose 0.1%, extending its all-time high from the prior day, while the Dow Jones Industrial Average climbed 0.3% (171 points) and the Nasdaq increased 0.1%. Stocks of companies with high fuel costs led gains, including Norwegian Cruise Line Holdings (+6.8%) and United Airlines (+6%), as lower oil prices ease financial strain. Brent crude oil prices dropped 3.7% to $95.88 per barrel, and U.S. benchmark crude fell 4.5% to $89.72, reflecting hopes that a U.S.-Iran ceasefire holds and the Strait of Hormuz could reopen for oil tankers. The market also reacted to U.S. military strikes in southern Iran, labeled as self-defense, though tensions appeared to ease. Lower oil prices reduced inflation fears, benefiting stocks and bonds. Corporate earnings drove gains, with Bath & Body Works (+14.5%) and Abercrombie & Fitch (+12%) outperforming after exceeding analyst profit expectations, despite consumer pessimism about the economy. AI-related stocks surged, with Micron Technology rising 2.9% after a 19.3% jump the prior day, pushing its market value past $1 trillion. Analysts at UBS projected further gains due to AI-driven demand for computer memory, which has already tripled Micron’s stock value in 2026. Oil-and-gas stocks underperformed, as Exxon Mobil (-2.2%) and Chevron (-1.5%) declined amid falling crude prices, though both remain up roughly 20% year-to-date. Bond markets reflected easing inflation pressures, with the 10-year Treasury yield slipping to 4.47% from 4.50% late Tuesday. Lower yields ease mortgage costs, which have risen to their highest since last summer, and reduce borrowing risks for AI data center expansion. Abroad, European indexes rose modestly, while South Korea’s Kospi jumped 2.3% after SK Hynix surged 9.3%, benefiting from the AI boom. The market’s resilience stems from strong corporate profits despite inflation and geopolitical uncertainties, though high Treasury yields remain a constraint on economic growth and investment.
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