U.S. equities ended firmly in the red on Thursday as a hawkish inflation print and surging oil prices dominated sentiment. The S&P 500 shed 0.6% to close at 7,592.12, the Nasdaq Composite fell 0.7% to 26,081.73 and the Dow Jones Industrial Average lost 0.6% to 52,064.46. It marks the benchmark’s fourth consecutive session of declines — its longest losing streak since June — and leaves the S&P 2.7% below its mid-August record close.

Electronic technology bore the brunt, with Nvidia falling 2.4%, Intel sinking 5.6% and Dell losing 5.4%. Apple was a standout gainer, rallying 3.6% a day after unveiling the $1,999 iPhone Duo, its first foldable smartphone. Cooper slumped nearly 15% to lead S&P 500 decliners after missing revenue estimates. In Europe, the STOXX 600 fell 0.6% while the MSCI World Index dropped 0.7%.

“The market has shifted from a positively skewed, earnings-driven environment to a more macro-driven and uneven backdrop. Rates, inflation, oil prices, and Fed expectations are back at centre stage,” Keith Lerner, chief investment officer at Truist, told Investing.com.

Global Stock Indices — daily and 5-day performance. The Nikkei was the sole major index in positive territory on the day, with Hang Seng and Russell leading losses over five sessions.

Oil prices surged after the U.S. and Iran exchanged their largest strikes on shipping since the Hormuz conflict began in February. Iran said it struck 10 ships in and around the Strait of Hormuz, while the U.S. retaliated by destroying five Iranian oil tankers. The Houthi seizure of Yemen’s port of Mocha added a further threat to Red Sea traffic, compounding supply-side fears that have kept the oil market on edge for months.

Treasury Secretary Scott Bessent has dared currency traders to bet against him, invoking his “asymmetric information” advantage.

President Trump told reporters that there would be “a lot more” attacks on Iranian tankers and predicted the war would end after the November midterm elections. However, The Wall Street Journal reported that Trump’s top advisers have warned the conflict could drag on through the remainder of his term, which runs until January 2029. Against this backdrop, ANZ analysts warned that “oil flows from the Persian Gulf are likely to remain disrupted for the foreseeable future.”

Meanwhile, Treasury Secretary Scott Bessent continued his campaign to assert control over financial markets, warning currency traders “I am the house now” and daring them to bet against the yen. The U.S. Treasury announced a $6 billion buyback of 10–20 year maturities, triple its previous target, though it fell short of the $10 billion some market participants had anticipated. The 10-year Treasury yield surged 12 basis points to 4.96%, its highest since October 2023, prompting economist Mohamed El-Erian to note that the 30-year U.S. mortgage rate has breached 7%.

Mohamed El-Erian flags the socio-political consequences of surging bond yields — the 30-year U.S. mortgage rate has hit 7%.

Oil prices extended their weekly surge as the escalation in U.S.–Iran hostilities shattered any remaining hopes of a near-term de-escalation. WTI crude surged 7% to $102.78 a barrel — topping $100 for the first time since May 21 — while Brent crude climbed to above $107, its highest close in almost four months. Oil prices are now on track for two straight weeks of massive gains, driven by the resumption of military action after a weeks-long stalemate over control of the Strait of Hormuz.

Brent Crude YTD — the September spike above $100 marks the sharpest acceleration since the initial outbreak of the Iran war.

The European Central Bank raised interest rates by 25 basis points to 2.5% — its second hike since the Iran war began — and struck a hawkish tone that surprised markets. ECB President Christine Lagarde warned inflation was set to remain “well above target for an extended period,” with 2027 price growth now forecast at 2.5%, up from 2.3% in June. Bloomberg reported that ECB officials expect further hikes and could raise rates again as soon as October. Money markets now price in around 85 basis points of further tightening by end-2027.

Spot gold fell 1.7% to $4,324.15 as the dollar strengthened, with the dollar index rising 0.15% to 98.93. The euro slipped to $1.163 following the ECB decision. The yen eased 0.4% to ¥154.14 per dollar, pulling back from recent seven-month highs bolstered by the late-July joint U.S.–Japan intervention. Germany’s 10-year yield rose to its highest since 2011 at 3.50%, while France’s 30-year hit levels not seen since 2003. UK 10-year gilt yields climbed 11 basis points to 5.37%.

Commodities, Energy & FX — crude stands alone in positive territory with a 12.8% five-day gain. Gold, metals, iron ore and AUD all declined.

Oracle delivered a quarterly beat and raised its full-year profit guidance, sending shares up 6.6% after hours. The cloud infrastructure giant earned an adjusted $1.92 per share on revenue of $19.35 billion for fiscal Q1 2027, beating consensus estimates of $1.73 and $19.13 billion respectively. For fiscal 2027, Oracle now sees adjusted earnings of $8.10 per share on revenue of at least $90 billion, modestly above its prior forecast. The results are seen as a proxy for the AI infrastructure buildout, with Oracle Cloud Infrastructure competing directly with AWS, Azure and Google Cloud.

Adobe topped Wall Street’s Q3 estimates on robust subscription growth, posting adjusted EPS of $6.13 versus consensus of $6.07 on revenue of $6.76 billion (13% year-on-year). However, shares edged down 2.5% after the software maker issued Q4 revenue guidance of $6.80–$6.85 billion, with the midpoint falling shy of the $6.85 billion analyst consensus. Adobe raised its full-year revenue guidance to $26.576–$26.626 billion and announced it had crossed one billion monthly active users across its platform.

The ASX 200 shed 1.2% on Thursday to close at 8,804.20, wiping an estimated $50 billion in market capitalisation in what was the benchmark’s worst session since March. Surging oil prices and rising global bond yields rattled sentiment, with nine of eleven industry sectors finishing lower. St Barbara (SBM) surged 16% to lead All Ordinaries gainers while Westgold Resources (WGX) fell 4.9%, among the top ASX 200 decliners.

ASX 200 futures were down 79 points or 0.9% to 8,732 near 6am AEST, pointing to another weak session. Macquarie Asset Management is reportedly in advanced talks to buy energy services firm SI Solutions in a deal valued at about $600 million including debt, alongside co-investor UniSuper. The AUD was steady at US72.17¢.