U.S. Markets End Lower Amid Mideast Uncertainty
U.S. stocks closed lower on August 12, with all three major indices falling as investors remained skeptical about a comprehensive resolution to the U.S.-Iran conflict.
Among the top 20 most active U.S. stocks by volume, Google fell over 3%, even as its CEO revealed that Gemini now boasts over 1 billion monthly active users. NVIDIA launched its first open-source AI model. Apple saw another leadership change as its head of payments and wallet services, Bailey, announced retirement. Super Micro Computer surged in after-hours trading after reporting revenue guidance far exceeding expectations.
Most Chinese concept stocks declined, with Alibaba and Baidu dropping over 3%, while NetEase and JD.com fell more than 4%.
Commodities: Oil Gains, Copper Flat, Gold Eases
Oil prices climbed, copper remained largely unchanged, and gold edged lower. European stocks closed flat as investors continued monitoring Middle East developments.
Geopolitical Flashpoints
The U.S. Central Command reported opening fire on a vessel violating the blockade on Iran. The military stated it used missiles to strike a merchant ship heading to an Iranian port. The Joint Maritime Information Center noted that a container ship in the Gulf of Oman was hit by a missile launched from a helicopter.
Iran’s senior officials said the Strait of Hormuz will remain closed unless the U.S. accepts its conditions. A U.S. judge halted a Trump-era executive order restricting mail-in ballots. Houthi rebels targeted a ship carrying Saudi military equipment in the Bab el-Mandeb Strait, and also launched missiles and drones at targets in Marib and Mocha.
Economic Data & Central Bank Views
U.S. existing home sales fell to a three-month low, pressured by high prices and mortgage rates. The Chicago Fed president flagged inflation as the biggest challenge for the U.S. economy. The New York Fed’s study showed credit card debt reached $1.26 trillion, with the K-shaped recovery persisting.
France’s central bank forecast the economy would maintain growth momentum in the third quarter. In Europe, German and British government bonds turned higher, while oil prices gave back some gains.
The U.S. expects oil supply disruptions from the Iran conflict to last until the end of 2027. A research report warned that critical U.S. ammunition stockpiles have fallen to "dangerous" levels, requiring years to replenish.
Corporate & Market Commentary
NVIDIA’s credit risk indicators declined after its CEO clarified a $500 billion financing plan. An OpenAI executive, Brad Lightcap, is leaving to start a new project. An Air India pilot tested positive for drugs after a flight where the plane suddenly dropped about 300 feet.
Barclays noted that the U.S. bond market’s increased reliance on price-sensitive buyers is likely to keep yields elevated. The U.S. 3-year Treasury auction saw strong demand, with the highest stop-out yield since 2025. Treasury Secretary Bessent welcomed Meta’s release of Muse Glimmer.
Eurizon expects U.S.-Japan support could push the yen to 125, urging short-sellers to reconsider. Citadel Securities is bullish on a stock market rebound, advising investors to prepare for a resurgence of leveraged bets. Bank of America stated the dollar is more sensitive to lower-than-expected CPI readings.