US stocks extended losses on Tuesday as rising tensions in the Middle East heightened fears of a global energy shock. The S&P 500, Dow Jones Industrial Average, and Nasdaq 100 each fell as much as 1% before paring some of their declines.
President Trump intensified his rhetoric against Iran, signaling the prospect of aggressive overnight strikes. Tehran responded by cutting communication channels, further undermining hopes for a diplomatic breakthrough. At the same time, Iran continued to restrict tanker traffic through the Strait of Hormuz, a key global oil chokepoint, adding to concerns over energy supply disruptions.
Technology shares were among the hardest hit as deteriorating risk sentiment weighed on demand for more speculative sectors. Nvidia, AMD, and Micron each slipped around 1%, while Tesla fell more than 3%. Apple lost 4% following a Nikkei report that the company is facing setbacks in the testing phase of its planned foldable iPhone.
In contrast, some chipmakers outperformed. Broadcom rose 4.5% after announcing a long-term agreement with Alphabet to supply tensor processing units (TPUs). Intel gained 3% on reports that it is close to signing a deal with xAI to develop semiconductors.
