US stock indices slipped on Tuesday as renewed tensions in the Middle East sent crude oil prices to their highest level since late July, while investors awaited key inflation readings due later this week.
As of 10 a.m. Eastern Time, the S&P 500 fell 0.4%. The Dow Jones Industrial Average was down 1% and the Nasdaq Composite was 0.3% lower.
At the open, the Dow Jones Industrial Average fell 303.8 points, or 0.57%, to 53,110.45. The S&P 500 fell 0.8 points, or 0.01%, to 7,717.81, while the Nasdaq Composite rose 21.6 points, or 0.08%, to 26,528.571.
Brent crude futures moved above $98 a barrel after Houthi attacks targeted Saudi oil infrastructure. The attacks came as part of efforts to gain control of the Bab al-Mandab Strait, an important route for Saudi crude shipments, after Iran imposed a blockade on the Strait of Hormuz.
The rise in oil prices added another layer of uncertainty for investors, particularly ahead of crucial US inflation figures that could influence the Federal Reserve’s interest-rate decision later this month.
Markets are now focused on the consumer and wholesale inflation reports due later this week. The data will be closely watched for clues about the US central bank’s policy stance ahead of its September 16 meeting.
“Our forecast is that we’re going to see a fairly big inflation increase this month, so we are expecting the Fed will raise rates,” said FHN Financial’s Chris Low.
Key stock movers
Shares of GE Aerospace gained 0.7% after the company announced plans to acquire Consolidated Precision Products (CPP) for $11.75 billion.
The deal will see GE Aerospace purchase CPP from private investment firms Warburg Pincus and Berkshire Partners.
Bullion
Gold prices edged lower on Tuesday as rising oil prices fueled inflation concerns.
By 09:44 a.m. EDT (1344 GMT), spot gold fell 0.2% to $4,396.19 per ounce, while US gold futures for December delivery dropped 0.8% to $4,441.30.
Among other metals, silver edged 0.33% lower to $65.92 per ounce, platinum steady at $1,827.83 and palladium slid 2.7% to $1,351.39.