S&P 500 rebounds from Monday’s decline as oil prices ease: Live updates

The S&P 500 rebounded on Tuesday following a losing session on Wall Street with oil prices and bond yields in focus as Wall Street assessed ongoing tensions in the Middle East.

The S&P 500 gained 0.7% and the Nasdaq Composite rose 1.2%. The Dow Jones Industrial average added 15 points.

West Texas Intermediate oil futures dropped nearly 4% Tuesday after rising to start the week, as traders monitored Israel’s expected retaliation to Iran missile attacks and U.S. efforts to stave off a wider regional conflict. The move pressured energy stocks, with the S&P sector slumping nearly 3% as Marathon Petroleum and Valero Energy shed at least 4% each.

“The war seems to be on the forefront of everybody’s mind,” said Robert Pavlik, senior portfolio manager at Dakota Wealth Management. “Bigger picture is the election and there are a lot of uncertainties revolving around taxes and how that’s going to impact earnings potentially going forward.”

Technology shares powered higher Tuesday, with Nvidia and Broadcom last up 3% and more than 2%, respectively. Meta Platforms, Tesla and Microsoft rose at least 1% each, while Palo Alto Networks rallied 5%.

The start of the new trading month has ushered in a bout of volatility as fears mount of an escalation conflict in the Middle East. Rising bond yields have also weighed on the market, with the 10-year Treasury yield touching its highest level since Aug. 1 on Tuesday.

The market rallied slightly to end last week after a blockbuster jobs report, and the Dow notched a new all-time closing high. However, enthusiasm faded this week as investors reasoned that the Federal Reserve may not be as aggressive with future rate cuts given the labor market’s strength.

Short-term economic data has further signaled a resilient economy, boosting fears that the central bank may “drag their feet” on interest rate cuts from here, added Dakota’s Pavlik.