U.S. stocks fall amid oil price volatility, fading rate cut hopes


NEW YORK, March 19 (Xinhua) -- U.S. stocks ended lower on Thursday as severe volatility in global energy markets and fading expectations for near-term interest rate cuts weighed heavily on Wall Street.

The Dow Jones Industrial Average fell 0.44 percent to 46,021.43. The S&P 500 sank 0.27 percent to 6,606.49. The Nasdaq Composite Index shed 0.28 percent to 22,090.69.

Eight of the 11 primary S&P 500 sectors ended in the red. The materials and consumer discretionary sectors led the laggards, dropping 1.55 percent and 0.87 percent, respectively. Meanwhile, the energy and financials sectors led the gainers, advancing 1.48 percent and 0.03 percent.

Oil prices experienced dramatic intraday swings. Earlier in the session, Brent crude futures surged by as much as 10 percent, climbing as high as 119 U.S. dollars per barrel, following reports that Iran and Israel had exchanged attacks on highly important oil and gas facilities.

Prices retreated after Israeli Prime Minister Benjamin Netanyahu addressed the media, saying that Israel was assisting the United States with intelligence and other means to keep the critical Strait of Hormuz open. Following the remarks, U.S. benchmark West Texas Intermediate crude futures settled down 0.19 percent at 96.14 dollars a barrel. Conversely, Brent crude futures, the international benchmark, advanced 1.18 percent to settle at 108.65 dollars per barrel, marking its highest closing level since July 2022.

On the monetary policy front, although the Federal Reserve previously signaled that one interest rate cut could still occur this year, current market bets suggest policymakers will maintain current levels, particularly following recent hawkish comments from Federal Reserve Chair Jerome Powell.

Analysts at Macquarie have suggested that the central bank's next move could be an interest rate hike rather than a reduction. "While the outlook is particularly uncertain in the context of the oil price spike, our base case remains that the Fed will remain on hold in coming months, with no additional cuts on the horizon," Macquarie said. "We see the next move as a hike. However, with more mixed signals from the labor market and the potential for consumer headwinds near-term from higher oil, we have now pushed out this timing to 1H27 (first half of 2027)."

In corporate news, Micron Technology dropped 3.78 percent as the semiconductor manufacturer's aggressive artificial intelligence spending plans overshadowed a strong quarterly earnings report. Furthermore, Alibaba slid over 7 percent after the company reported a 67 percent plunge in quarterly profits, highlighting growing investor demands for tangible returns on massive artificial intelligence investments.

All the "Magnificent Seven" technology giants finished in the red for a second consecutive session. Tesla led the group's decline, shedding more than 3 percent.

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