Stocks Slide as Tanker Strikes Send Oil and Yields Higher
Two oil tankers were hit near the Strait of Hormuz overnight, pushing crude above $87 and lifting the 10-year Treasury yield to its highest level since January 2025.
Market Snapshot
All figures are indicative opening levels as of this morning, September 1.
Futures point to a lower open as renewed US-Iran hostilities pull money out of stocks and into oil and safe-haven metals.
The Dow and S&P 500 both slip around 0.5 percent and the Nasdaq lags near 1 percent, while the VIX firms toward 15, the dollar holds near 99.5, gold climbs around 1.8 percent to about 4,461, silver adds around 1.3 percent, and WTI jumps around 2.3 percent to around 87.75.
The bid is concentrated where the story is, with Exxon and Chevron riding the crude spike higher and defense name Lockheed Martin firming as the conflict escalates.
Main Story
The renewed US-Iran fight is back at the center of the tape after two oil tankers were struck near the Strait of Hormuz overnight.
- A Saudi-owned and a South Korean-owned tanker were hit by projectiles Monday night, sending WTI up around 2.3 percent toward 87.75 and Brent above 92, per TheStreet Tuesday morning.
- The mainstream read is a straightforward supply-risk premium, since any threat to a corridor that moves close to a fifth of global oil gets priced quickly.
- What the tape may be missing is the second-order move in rates, with the 10-year yield pushing to its highest since January 2025 as the oil shock lifts inflation fears and September Fed hike odds near 82 percent on CME FedWatch.
Chart of the Day
The 10-year Treasury yield has ground steadily higher all month and touched around 4.79 percent this morning, its highest level since January 2025.
The move is less about the Fed alone and more about the oil shock feeding back into inflation expectations alongside heavy government borrowing.
The next line in the sand sits overhead near 4.85 percent, a level that would tighten financial conditions further for richly valued equities.
Technical Trading
A few levels worth watching across the tape.
- The 10-year yield cleared its August range at around 4.79 percent, with first resistance near 4.85 percent and rising support back around 4.60 percent.
- WTI pushed through the $85 resistance that capped its late-August triangle, with the 100-day and 200-day averages converged as support around 82 to 83.
- Crude’s RSI is nearing overbought after the tanker-strike gap, leaving limited room before a pause, while gold’s safe-haven bid holds it near 4,461.
Global News
- Two oil tankers were struck near the Strait of Hormuz overnight, reviving the war premium and setting a risk-off tone for the first session of September.
- Brent held near 92 dollars and WTI above 87 as traders priced prolonged disruption to Gulf energy flows.
- CME FedWatch now shows around an 82 percent chance of a September Fed rate hike as the energy shock keeps inflation in focus.
- Long-term Treasury yields stayed elevated even after the Treasury’s expanded buyback program, pointing to pressure beyond Fed policy.
- Stocks closed August with a fifth straight monthly gain before Monday’s selloff on the renewed conflict.
Texas News
Higher crude is a direct tailwind for Texas producers, with Permian rig counts turning back up after the war reversed a summer decline, per the Dallas Fed.
Diamondback Energy’s leadership expects the basin’s power demand to double over the next decade as data centers and drilling compete for West Texas electricity.
Looking Ahead
Wednesday, September 2: ISM manufacturing lands, a fresh read on whether the factory sector is holding up under higher energy costs.
Friday, September 5: The August jobs report arrives, the key input for a Fed meeting where hike odds now sit near 82 percent.
Monday, September 7: US markets are closed for the Labor Day holiday, leaving thin overseas trading to absorb any weekend escalation.
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Prices from Yahoo Finance, CNBC and Fortune. Technical levels from Investing.com and FXStreet. News from Reuters, Al Jazeera and CNBC.
For informational purposes only. Not investment advice. Prices are indicative opening levels and may differ from your broker.
