Stocks drop from record highs as Gulf tensions flare

Added: 2026-06-03

[00:00:01]Stocks fell back from record highs on Thursday. Investors were spooked by a fresh US military strike on Iran and Kuwaiti reports of a missile attack.

[00:00:11]The update hurt market confidence in a peace deal many see as key to easing global inflation risks. Oil rose as much as 4% and bond prices fell due to the escalation.

[00:00:22]US President Donald Trump had earlier dismissed an Iranian report of a deal to resume traffic through the Strait of Hormuz.

[00:00:29]The US military said it had carried out new strikes targeting an Iranian drone operation. While Tehran said it had attacked a US airbase in Kuwait. Brent crude was up 2 and 1/2% just over $96 a barrel with transit through the Strait at a low number.

[00:00:43]The price has fallen back from 4-year highs above $126 in late April. But it's still a third above pre-war levels and 50% higher than a year ago.

[00:00:52]Yields on 10-year Treasury notes were at 1.7 basis points at 4 and 1/2% that a sustained high oil prices kept upward pressure on inflation expectations.

[00:01:03]The developments also cooled this week's tech-led rally in stock markets that had pushed global indexes to new record highs.

[00:01:10]Europe's STOXX 600 was down 0.6% in morning trading just below February's all-time peak.

[00:01:15]While US stock futures were also slightly down.