US sharemarkets edged lower on Tuesday, giving back some of the strong gains from the previous session as investors assessed fresh developments in the conflict with Iran. The S&P 500 fell 0.37% to close at 6,556.37, while the Dow Jones Industrial Average slipped 84 points, or 0.18%, to 46,124.06. The Nasdaq Composite declined 0.84% to finish at 21,761.89.
The pullback followed a sharp rally on Monday, which had been driven by optimism around potential diplomatic progress.
Oil rises again amid uncertainty
Energy markets remained volatile, with oil prices rebounding after the prior session’s sharp decline. Brent crude rose 4.55% to settle at US$104.49 a barrel, while West Texas Intermediate crude gained 4.79% to US$92.35.
The renewed rise in oil prices came as uncertainty persisted around the outlook for negotiations, with conflicting reports about whether meaningful talks between the US and Iran are underway.
Markets grapple with mixed signals
Investor sentiment remains fragile as geopolitical developments continue to shift. While US officials signalled that negotiations are ongoing, reports of continued strikes and potential troop deployments in the region have raised doubts about how quickly the conflict can be resolved.
Energy stocks outperformed, making it the only S&P 500 sector in positive territory for the month, while technology shares came under pressure.
Australian market outlook
Australian shares are expected to open higher, despite the weaker lead from Wall Street, as futures point to gains of 51 points, or 0.6%, to 8,669.
Locally, investors will focus on February consumer price index data due at 11.30am AEDT.
