NEW YORK / RankWire.AI / – Amid ongoing market turbulence, Wall Street extended its downward trajectory on Wednesday following a significant drop in the Dow Jones Industrial Average the day before. The index decreased by 628 points in the last session. On Wednesday, the Dow fell further by 0.77%, while the Nasdaq Composite declined 0.64% and the S&P 500 slipped 0.48%. These losses were part of a broad-based retreat across major U.S. stock indices that persisted from Tuesday, with persistent increases in oil prices and Treasury yields playing key roles in both sessions.
Tuesday’s sharp selloff resulted in the Dow dropping 628.18 points, or 1.2%, to 52,786.07. The S&P 500 decreased by 45.08 points, or 0.6%, closing at 7,673.52. The Nasdaq Composite lost 85.58 points, or 0.3%, ending at 26,421.41. The Russell 2000 also declined by 15.44 points, or 0.5%, to 2,960.20. U.S. markets had just reopened after a three-day holiday weekend.
Energy prices gained momentum amid disruptions impacting oil shipments from the Middle East. Brent crude briefly surged toward $99.50 a barrel on Tuesday before settling at $97.92. On Wednesday, it surpassed $100 and closed at $101.21. Meanwhile, West Texas Intermediate crude finished the day at $96.05 a barrel. The rise in energy costs coincided with investors awaiting new U.S. inflation reports, which added pressure on the markets.
Rising oil and bond yields weigh on equities
The downturn on Wednesday impacted nearly all sectors of the U.S. stock market. The energy sector within the S&P 500 gained around 1.1%, yet every other key sector ended the day lower. Apple shares dipped 0.3% after the company’s latest smartphone launch, while Meta Platforms increased more than 6% following the release of new artificial intelligence features. Overall, stocks declined more than they advanced within the S&P 500 by a ratio of over four to one.
Treasury yields also rose during Wednesday’s trading session, with the benchmark 10-year U.S. Treasury yield reaching its highest point since November 2023. Additionally, the U.S. Treasury Department announced plans to purchase up to $6 billion worth of government bonds maturing between 10 and 20 years. The rise in bond yields makes stocks less attractive, as higher yields increase competition for investor capital, given Treasuries’ lower risk compared to equities.
Market focus shifts to upcoming inflation reports
The recent declines occurred ahead of two key U.S. inflation reports scheduled for Thursday and Friday, covering producer and consumer prices for August. These figures will precede the Federal Reserve’s policy meeting set for September 15 to 16. Traders are currently pricing in roughly a 60% chance of an interest rate hike. The Federal Reserve continues to monitor inflation metrics closely while evaluating economic conditions and market developments.
Despite the two-day slide, major U.S. stock indices remain higher for 2026. After Wednesday’s close, the S&P 500 was up about 12% for the year and approximately 2% below its record close on August 13. The Nasdaq advanced roughly 13%, while the Dow has gained about 9%. Trading volume on Wednesday reached around 14.7 billion shares, slightly below the recent 20-session average of 14.9 billion.