NEW YORK (AP) — U.S. stocks are losing ground Tuesday as Wall Street weighs the latest round of profit reports from big companies with the lingering risks from the ongoing war between the U.S. and Iran.
UnitedHealth Group and other big companies showed they’re making even bigger profits than analysts expected. Oil prices, meanwhile, rose moderately as last-minute ceasefire talks between the United States and Iran looked uncertain.
The S&P 500 fell 0.4%,
coming off just its second drop in 14 days, and is hovering below its all-time high. The Dow Jones Industrial Average was down 194 points, or 0.4%, as of 2:33 p.m. Eastern time, and the Nasdaq composite was down 0.3%.
UnitedHealth helped lead the market with a jump of 8.8% after reporting stronger profit and revenue for the beginning of the year than analysts expected. It also raised its forecast for profit over the full year of 2026.
That’s big because stock prices tend to follow the path of corporate profits over the long term. It’s a double-plus for investors when companies not only top earnings estimates but also forecast even better growth ahead.
Quest Diagnostics rose 4.9% after it likewise joined the fattening list of companies topping expectations for profit and revenue during the latest quarter. It also raised its forecast for profit for the full year.
They helped offset a 12% drop for Tractor Supply, whose profit and revenue for the latest quarter fell short of expectations.
Other signals are also indicating the U.S. economy may be doing OK despite sharp up-and-down swings for oil prices because of the war with Iran. A report on Tuesday morning showed that U.S. retailers made more money in March, the first full month of the war, than analysts expected.
Growth was even relatively stable for retail sales when not including those from gasoline stations.
“It’s become cliched to say that the economic hit will depend on the duration of the Middle East conflict, but that cliché does ring true,” according to Brian Jacobsen, chief economic strategist at Annex Wealth Management.
The price for a barrel of Brent crude oil, the international standard, rose 3.3% to $98.63 ahead of Wednesday's scheduled expiration for a U.S.-Iran ceasefire agreement. Both sides remain dug in rhetorically. Trump has warned that “lots of bombs” will “start going off” if there’s no agreement before the ceasefire deadline, and Iran’s chief negotiator said that Tehran has “new cards on the battlefield” that haven’t yet been revealed.
Much of the tension in financial markets has focused on what will happen to the Strait of Hormuz, a narrow waterway off Iran’s coast that oil tankers use to exit the Persian Gulf. A long-term closure would keep crude oil pent up in the gulf and away from customers worldwide.
The price for a barrel of Brent oil has gone from roughly $70 before the war to $119 at times as worries have risen and fallen about a long-term closure for the strait.
On Wall Street, Apple fell 2.3% after Tim Cook said he’ll step down as CEO on Sept. 1 and become the iPhone maker’s executive chairman. He’s handing control over to John Ternus, a company veteran who rose through Apple's hardware engineering ranks.
Amazon rose 1.2% after Anthropic said it signed a new agreement and is committing more than $100 billion over the next 10 years to AWS technologies to train and run its Claude chatbot.
In stock markets abroad, indexes were lower in Europe following a stronger finish in Asia. South Korea’s Kospi rose 2.7% for one of the world’s biggest moves.
In the bond market, Treasury yields gained ground. The yield on the 10-year Treasury rose to 4.29% from 4.26% late Monday.
Kevin Warsh, President Donald Trump's nominee to chair the Federal Reserve, appeared on Capitol Hill Tuesday. He's facing a tightrope walk, as investors want to see if he would maintain the Fed's independence from political meddling. During the hearing, he pledged to fight inflation even though Trump has been pushing hard for lower interest rates. Higher inflation typically leads the Fed to raise rates, or at least keep them unchanged, rather than cut them.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed to this report.
