US equity indexes experienced a notable decline alongside government bond yields as job openings in the US unexpectedly surged. A statement from the White House regarding Iran's preparations for an imminent ballistic missile strike on Israel fueled significant rallies in oil and gold futures. The Nasdaq Composite saw a drop of 1.7%, closing at 17,884.5, while the S&P 500 fell by 0.9% to 5,708.2.
The Dow Jones Industrial Average traded 0.4% lower at 42,180.5. A broad range of sectors witnessed declines during the trading day, with technology and consumer discretionary stocks leading the downward movement. In contrast, energy and utilities sectors were among the few areas to post gains. West Texas Intermediate crude oil prices surged by 4.4%, reaching $71.13 per barrel, coinciding with gold prices, which jumped by 1% to $2,686.71 per ounce.
This market reaction followed White House comments concerning Iran's potential military actions, amidst Israel's recent limited ground operations targeting Hezbollah forces in southern Lebanon. This escalation of geopolitical tensions further contributed to market uncertainties, leading investors to seek refuge in traditional safe haven assets. The CBOE Volatility Index—often referred to as the fear gauge for investors—rose sharply by 12%, climbing to 18.75 as concerns regarding geopolitical instability intensified.
In tandem, most US Treasury yields fell through the trading session; the 10-year yield dropped by 9.1 basis points to 3.71%, while the two-year yield decreased by 5.7 basis points to 3.59%. The US Dollar index, however, showed resilience with a 0.5% increase, bringing it to 101.27. In unrelated news, a significant strike by the International Longshoremen's Association commenced overnight.
This action has resulted in the shutdown of ports across the entire span from Maine to Texas. The strike centers on demands for substantial wage increases and protections against job automation, affecting ports that manage approximately 57% of the total US container volume. The ramifications of this strike could disrupt supply chains significantly, especially as the nation heads toward the presidential election and the busy holiday shopping season. Furthermore, in economic developments, US job openings climbed to 8.040 million in August according to assessments from the Bureau of Labor Statistics.
This figure surpassed expectations of 7.673 million as per a Bloomberg survey and also showed a rise from the 7.711 million reported in the previous month, July. Meanwhile, the Institute for Supply Management's US manufacturing index remained stable in September, mirroring the August figure of 47.2, which fell short of expectations for a slight increase to 47.5 in the same Bloomberg compilation. In the realm of corporate news, APA Corp.
announced that its subsidiary achieved a "positive" final investment decision concerning the inaugural oil development project located in Block 58, offshore Suriname. This project entails a total investment of approximately $10.5 billion, with oil extraction expected to commence in 2028. Following the announcement, APA shares soared by 5%, emerging as the top performer within the S&P 500..