· S&P 500 snaps win streak as Middle East tensions push down Wall Street
The Dow Jones Industrial Average .DJI fell 233.92 points, or 0.81%, to 28,634.88. The S&P 500 .SPX lost 23 points, or 0.71%, to 3,234.85. The Nasdaq Composite .IXIC dropped 71.42 points, or 0.79%, to 9,020.77.
For the week, the Dow dipped 0.04%, the S&P 500 fell 0.17%, and the Nasdaq rose 0.16%.
Wall Street’s major indexes fell from record highs on Friday after a U.S. air strike in Iraq ratcheted up tensions in the Middle East and a bigger-than-expected contraction in the U.S. manufacturing sector raised concerns of slowing economic growth.
Friday’s decline put the benchmark S&P 500 in the red for the week, snapping a five-week winning streak for the index.
Demand for safe-haven assets soared as Iran vowed revenge for the killing of Qassem Soleimani, head of its elite Quds Force, in an air strike authorized by U.S. President Donald Trump.
In a further blow to U.S. market sentiment, data from the Institute for Supply Management showed that U.S. factory activity contracted in December by the most in more than a decade.
S&P 500 bank stocks .SPXBK dropped 1.6% as the news sent benchmark U.S. bond yields US10YT=RR to their lowest since Dec. 12.
· European stocks closed lower on Friday as geopolitical tensions spiked after U.S. airstrikes in Iraq killed a top Iranian military commander.
The pan-European Stoxx 600 closed provisionally down 0.4%. Travel and autos stocks led the losses while oil and gas shares rose over 1% on the back of renewed unrest in the Middle East.
· Asia Pacific markets fell on Monday following heightened geopolitical tensions in the Middle East.
Japanese shares returned for their first day of trade with the benchmark Nikkei 225 declining 1.85% in early trade while the Topix index was down 1.48%. In South Korea, the Kospi index fell 0.83%.
In Australia, the ASX 200 was down 0.72%, with most sectors trading lower. The heavily weighted financials subindex was down 1.28% as shares of major banks in the country fell, but the energy sector rose 0.78%.
Australia has been grappling with a devastating fire season that’s expected to worsen as the summer months continue. Wildfires have killed at least 18 people so far, destroyed more than 1,000 homes and nine million acres. Nearly half a billion animals in the state of New South Wales are said to have been killed by the blazes in the last few months and the death toll is expected to rise.
Reference: CNBC, Reuters
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