Wall Street’s main indexes were volatile on Tuesday as oil prices and U.S. Treasury yields rose, while investors reacted to the latest reports on the Middle East conflict a day after the market had a relief rally following the U.S. postponement of strikes on Iranian power plants. Bond yields extended gains after a weak auction of 2-year Treasury notes, adding pressure to equity markets, where Nasdaq composite was leading losses and the Dow Industrials lost steam but then turned higher again.
Stocks also added to losses after reports the Pentagon is expected to send thousands of troops from the elite 82nd Airborne Division to the Middle East. A Reuters report, citing two people familiar with the matter, said this would add to the massive military buildup there even as the White house has said it seeks talks with Iran. But indexes regained lost ground after the President told reporters that the United States was talking to “the right people” in Iran in order to reach an agreement to end hostilities and that Iran has agreed they will never have nuclear weapons.
The Dow Jones Industrial Average .DJI .DJI closed down 84 points to 46,124, the S&P 500 .SPX .SPX lost 24 points, or 0.02%, to 6,556 and the Nasdaq Composite .IXIC .IXIC lost 184 points, or 0.47%, to 21,761. Among the 11 S&P 500 major industry sectors, energy .SPNY .SPNY led gains with a 2.2% advance while the biggest losses were in communication services .SPLRCL .SPLRCL , down 1.9% and technology .SPLRCT .SPLRCT , which was off 0.4%.
Meanwhile, private credit concerns resurfaced after a report that Ares Management ARES.N ARES.N limited redemptions at 5% at its private credit fund, along with Apollo Global Management APO.N APO.N , as withdrawal requests surged. Both stocks were down about 1%. Peers Blackstone BX.N BX.N and Carlyle CG.O CG.O were off 2% and 0.8% respectively.
Earlier a survey showed U.S. business activity slowed to an 11-month low in March as the Middle East war raised prices for energy products and other inputs. Higher oil prices have revived inflation jitters and complicated the interest rate outlook for central banks. The U.S. Federal Reserve struck a hawkish tone last week, projecting only one reduction in 2026. Traders are no longer pricing in any rate cuts this year, compared with two reductions expected before the Middle East conflict erupted. Expectations for hikes nudged higher amid escalating tensions last week, but were quickly unwound after Trump’s comments on Monday, according to CME’s FedWatch Tool.
Among individual movers, shares of Jefferies JEF.N JEF.N gained 3% after the Financial Times reported that Japan’s Sumitomo Mitsui Financial Group 8316.T 8316.T is working on plans for a possible takeover of the investment bank. Cosmetics maker Estee Lauder EL.N EL.N fell 10% after it said it was in talks for a potential merger with Spanish beauty group Puig Brands PUIGb.MC PUIGb.MC .
Barclays lifted its 2026 year-end target for the S&P 500 index .SPX .SPX to 7,650 from 7,400, citing stronger earnings expectations that outweigh macro risks like Middle East tensions, AI-driven disruption and stress in private credit. Declining issues outnumbered advancers by a 1-to-1 ratio on the NYSE where there were 139 new highs and 167 new lows. On the Nasdaq, 2,019 stocks rose and 2,632 fell as declining issues outnumbered advancers by a 1.3-to-1 ratio. The S&P 500 posted 20 new 52-week highs and 18 new lows.
Reporting by Sinéad Carew in New York, Purvi Agarwal and Twesha Dikshit in Bengaluru; Editing by Sherry Jacob-Phillips, Maju Samuel and Aurora Ellis.
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