The Nasdaq 100 suffered its largest single-day decline in a fortnight, as investors grappled with the combined pressures of climbing bond yields and surging oil prices, which clouded the outlook for Federal Reserve policy. The tech-heavy index closed 1.3% lower, having touched an intraday loss of 1.7%, while the broader S&P 500 slipped 0.7% with seven of its 11 primary sectors finishing in the red.

Consumer discretionary stocks led the declines, while energy shares were the standout gainers. A widely-tracked exchange-traded fund focused on semiconductor equities dropped 2.1%, though chipmakers managed to pare some losses during the session. Nvidia fell 1.5% after opening down 2.6%, Advanced Micro Devices lost 2.4%, and Micron Technology slid 2.6%.

Wall Street's downward pressure was largely attributed to another round of selling in global bond markets, exacerbated by hawkish remarks from Federal Reserve Chair Warsh at Jackson Hole, which prompted traders to increase their bets on interest rate hikes this year. Adding to the unease, fresh US strikes on Iranian targets and Tehran's retaliatory response drove crude prices sharply higher. Despite these factors, the Cboe Volatility Index, often dubbed Wall Street's "fear gauge," hovered near 16, a level typically not associated with widespread market panic.

Commenting on the resilience, Jeff Buchbinder, chief equity strategist at LPL Financial, noted that "strong earnings and the AI outlook continue to underpin the stock market, limiting the depth of any pullback." In corporate news, Apple advanced 2.6% following the official transition of leadership, with John Ternus succeeding Tim Cook as chief executive officer.

By the closing bell, the S&P 500 had fallen 0.7% to 7,631.47 points, the Dow Jones Industrial Average dropped 0.8% to 52,766.88 points, the Nasdaq Composite declined 1% to 26,099.77 points, the Nasdaq 100 finished 1.3% lower at 29,077.22 points, and the Russell 2000 slipped 1.2% to 2,920.132 points.