Dow closes sharply lower as oil surge fuels inflation fears

Key Points:

• US stocks closed sharply lower on Tuesday, led by the Dow Jones dropping 628 points amid surging oil prices and renewed inflation concerns, with Brent crude nearing $100 a barrel due to Middle East tensions disrupting energy supplies.
• Rising oil prices pushed the 10-year US Treasury yield to around 4.8%, increasing expectations for a possible Federal Reserve rate hike at the upcoming policy meeting, while markets also faced pressure from escalating US-Canada trade tensions as Canadian retaliatory tariffs took effect.
• Key earnings reports are anticipated on Wednesday from companies including Chewy, Jersey Mike’s, Korn Ferry, and Signet Jewelers, as investors seek further guidance amid economic uncertainty.
• In market movers, Novartis shares fell sharply after a Phase 3 trial failure, Qualcomm shares rose on a new AI chip partnership with Amazon, and BioVie advanced its Parkinson’s drug program toward Phase 3 after FDA engagement.
• Canadian Prime Minister Mark Carney acknowledged that reducing reliance on the US amid the trade dispute would be costly but necessary, emphasizing efforts to diversify trade relationships and build economic resilience.