New York, March 3, 2026, 12:34 PM (EST) — Regular session
- Dow Jones Industrial Average down 1.7% in late morning as the Middle East conflict drives a fresh risk-off move
- Oil up about 8%, lifting inflation concerns and pushing traders to trim expectations for Fed cuts
- Travel and materials lag; Target gains while MongoDB and alternative-asset managers fall
The Dow Jones Industrial Average fell sharply on Tuesday as a jump in oil prices tied to the Iran conflict hit risk appetite and revived worries that inflation may stay sticky. At 11:42 a.m. ET, the Dow was down 831.86 points, or 1.70%, at 48,072.92. 1
The pressure is landing where it hurts: energy costs and trade routes. Iran has threatened to shut the Strait of Hormuz and warned it would attack ships trying to pass, putting a key artery for global oil flows at risk. 2
Oil did the rest. Brent surged about 8% to $83.81 a barrel and U.S. crude rose to $77.23, the highest levels since mid-2024, as traders priced in supply disruption and shipping delays around the Gulf. 3
That matters for the Fed now. Futures-linked pricing has shifted toward fewer cuts in 2026, with traders leaning away from an early restart to easing as higher fuel costs threaten to lift prices elsewhere; a basis point is one-hundredth of a percentage point. Goldman Sachs analysts estimated a sustained 10% rise in oil could add a few basis points to core inflation and a larger hit to headline CPI. 4
Strategists pointed straight at the oil move. “Oil’s rallied because of the escalation… This has pushed yields higher and stocks lower,” John Velis, Americas macro strategist at BNY, said. Jamie Cox, managing partner at Harris Financial Group, said investors are “acting rationally” about higher energy prices and the risk it pushes out the rate cuts markets had been counting on. 5
The slide on Tuesday followed a volatile start to the week. On Monday, the Dow dipped 0.15% to 48,904.78, while the S&P 500 ended nearly flat and the Nasdaq edged higher as buyers stepped in after early losses tied to the initial shock from the air strikes on Iran. 6
Some of the economic backdrop was firmer before geopolitics took over the tape. The Institute for Supply Management’s manufacturing gauge showed activity expanding again in February, with the PMI at 52.4, above the 50 mark that separates growth from contraction. 7
Corporate news added to the unease around credit and liquidity. Blackstone said withdrawals from its flagship private credit fund BCRED increased, with net outflows in the quarter, and its shares slid as investors questioned how fast redemptions can spread across the sector. 8
Software was another weak pocket. MongoDB shares sank about 27% after the database company projected first-quarter profit below estimates and flagged slower growth in its Atlas cloud business. 9
Target offered a rare bright spot in the Dow’s orbit. The retailer’s new CEO Michael Fiddelke laid out investment plans and a profit outlook that beat expectations, helping the stock climb even as broader consumer and travel names slipped. 10
The risk for bulls is simple: oil stays high. If crude pushes toward $100 and holds there, the market will have to revisit the idea of easier policy, and that can reprice equities quickly — especially for rate-sensitive and economically exposed names.
Next up, investors are watching whether energy prices cool and whether Washington signals any shift in the policy path. The week’s big scheduled test is the U.S. February jobs report, due Friday, March 6 at 8:30 a.m. ET. 11
