U.S. Stocks Slide Amid Middle East Tensions

U.S. stock markets declined on Tuesday, driven by investor caution following Iran's missile attack on Israel in retaliation for military actions against Hezbollah. The market downturn was accompanied by a rise in defense stocks and energy shares, while airline shares saw a decline. Economic uncertainties persist amid geopolitical tensions.

U.S. stock markets experienced a downturn on Tuesday as investor caution grew following Iran's missile attack on Israel. The Nasdaq fell over 1%, marking a significant slide influenced by Middle Eastern geopolitical tensions. In response to the attack, President Joe Biden commanded U.S. military support for Israel's defense.

Energy sector shares, including Exxon Mobil, saw an uptick as oil prices rose. Defense stocks also benefited, with Northrop Grumman and Lockheed Martin gaining ground. The S&P 500 aerospace and defense index surged more than 1% to reach a record high, and utilities rose by 0.7%. Despite the partial market resilience, airline shares like Delta Air Lines dropped by 1%.

Market volatility increased, with the CBOE's fear gauge climbing 2 points. Upcoming jobless claims data and monthly payroll reports later this week have added to market uncertainty. Investors remain cautious, with 62.2% expecting the Federal Reserve to lower rates at its November meeting. Meanwhile, a significant port strike affecting the East Coast and Gulf Coast adds another layer of economic unpredictability.

(With inputs from agencies.)