Wall Street experienced a sharp downturn on Thursday, with the Nasdaq Composite confirming it had entered correction territory, falling 2.4% to close at 21,408.08. This marks a more than 10% decline from its record closing high on October 29, signaling heightened volatility and investor anxiety. The broader S&P 500 index also slipped 1.7% to 6,478.41, while the Dow Jones Industrial Average fell 1% to finish at 45,959.43.
The primary driver behind the market slump is the escalating uncertainty surrounding the U. S.-Iran war. Conflicting signals regarding potential peace talks have left investors on edge. Remarks from President Trump indicating that the U. S. was unsure about its willingness to make a deal with Iran further exacerbated concerns. A senior Iranian official also told Reuters that a U. S. proposal to end the war was "one-sided and unfair".
The tech sector, heavily represented in the Nasdaq, is particularly vulnerable. Companies like Meta Platforms experienced significant losses, with Meta dropping 7.9% after verdicts holding it liable for harm to young users raised concerns about potential overhauls to its advertising business. Rising oil prices, with Brent crude closing up 5.7% at $108.01 per barrel, also contributed to the negative sentiment.
Investors are now closely watching whether this downturn is a temporary dip or the start of a sustained period of risk tied to the war. The coming weeks will likely be dictated by developments in the Middle East and any signs of progress towards de-escalation.
