US equities retreated on Thursday, interrupting the recent rally, as investors reacted to escalating tensions in the Middle East and parsed a batch of mixed corporate earnings. The Nasdaq 100 declined 0.9%, while both the S&P 500 and the Dow slipped 0.3%.
WTI crude futures climbed above $106 per barrel, supported by continued blockades in the Strait of Hormuz and media reports that air defense systems had been activated in parts of Tehran.
Technology shares, which had outperformed in the previous session, were the main source of weakness following uneven results from speculative AI-related companies. Tesla dropped 3.6% amid skepticism over its plans to significantly increase spending on AI and robotics. IBM and ServiceNow plunged 8% and 17%, respectively, after releasing their quarterly results, dragging broader software names into negative territory. Microsoft lost 3%, while Palantir Technologies and Oracle each fell 6%.
In contrast, Texas Instruments surged 19.4% after issuing a second-quarter revenue and profit outlook that exceeded market expectations.
