Stocks Fall As Geopolitics, Economic Worries Spook Investors, Chipmakers Sell Off, Bitcoin Tumbles To $60,000: What's Driving Markets Wednesday?

A sentiment of risk aversion looms over the markets during Wednesday’s trading session, triggering midday losses across the board in stocks and cryptocurrencies and prompting a flight towards bonds, as investor confidence remains dampened by geopolitical and economic risks.

The situation in the Middle East remains highly uncertain, with Israeli Prime Minister Benjamin Netanyahu stating that despite advice from allies to avoid a retaliation against Iran, Israel will make its own decisions on security.

Investors also parsed through the latest remarks from Fed Chair Jerome Powell, which officially dashed hopes for imminent rate cuts amid a lack of confidence about disinflation.

The S&P 500 declined by 0.5% by 1.15 p.m. EDT, while the tech-heavy Nasdaq 100 underperforming, down by 1.2%. Semiconductors were among the weakest-performing industries, with the VanEck Semiconductors ETF SMH falling by 2.5%, on track to close at its lowest level in nearly two months.

Investors sought refuge in Treasuries for liquidity, causing yields to drop by 8 basis points in the 10-year tenor, while the iShares 20+ Year Treasury Bond ETF TLT rallied by 1%. Gold softened by 0.5%, while silver managed to inch up by 0.8%.

Bitcoin BTC/USD faced significant downward pressure, with the largest cryptocurrency plummeting by 5.2% and hitting an intraday low of $59,650, now down 18% since its peak in March.

Wednesday’s Performance In Major US Indices, ETFs

Major Indices	Price	1-day Chg %
Dow Jones	37,743.82	-0.1%
Russell 2000	1,963.08	-0.5%
S&P 500	5,025.59	-0.5%
Nasdaq 100	17,524.58	-1.1%

The SPDR S&P 500 ETF Trust SPY fell 0.5% to $501.05, the SPDR Dow Jones Industrial Average DIA inched 0.1% lower to $377.69 and the tech-heavy Invesco QQQ Trust QQQ fell 1.1% to $426.78, according to Benzinga Pro data. 

Sector-wise, the Utilities Select Sector SPDR Fund XLU outperformed, up 1.4%. The Technology Select Sector SPDR Fund XLK was the major laggard, down 1%.

Wednesday’s Stock Movers

• United Airlines Holdings, Inc. UAL rose over 14%, amid stronger-than-expected financial results last quarter. Peers such as American Airlines Group Inc. AAL, Delta Airlines Inc. DAL rose 4.5% and 2.5%, respectively.
• Other companies reacting to earnings reports were J.B. Hunt Transport Services, Inc. JBHT, down 8%, Abbott Laboratories ABT, down 2.5%, ASML Holding N.V. ASML, down 7.5%, First Horizon Corporation FHN, up 2.2%, Travelers Companies, Inc. TRV, down nearly 8%, Prologis Inc. PLD, down 6.5%, and U.S. Bancorp USB, down 4%.
• GE Vernova Inc. GEV rallied 6% after BNP Paribas initiated coverage with an Outperform rating and $177 price target.
• Notable names reporting after the close are CSX Corp. CSX, Alcoa Corporation AA, Discover Financial Services DFS and Las Vegas Sands Corp. LVS.

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Image generated using artificial intelligence via Midjourney.