U.S. equities fell on Thursday, as oil prices surged amid escalating conflict in the Middle East, while investors weighed quarterly results from two of the largest companies in the world.
The Dow Jones Industrial Average lost 527 points, or 1%. The S&P 500 dropped 1%, while the Nasdaq Composite lost 1.8%.
Oil prices put more pressure on stocks, as they soared after Yemen's Tehran-backed Houthi militant group claimed attacks on two Saudi Arabian tankers in the Red Sea, fueling concerns about an expansion of the conflict in the Middle East.
Brent crude futures for July delivery gained 6% to trade above $100, while U.S. West Texas Intermediate crude futures advanced 5% to above $91 per barrel.
“Inflation has remained top of the agenda for markets this morning, with Brent crude moving up ... as the Middle East escalation continues,” Deutsche Bank's Jim Reid wrote in a note on Thursday morning.
Equities were also weighed down by a 6% slide in Alphabet shares after the Google parent lifted its forecast for 2026 capital expenditures to as high as $205 billion, pointing to strong artificial intelligence demand.
Tesla also dropped more than 12% after the electric vehicle maker posted a big earnings miss for the second quarter.
