US stocks open sharply lower, joining global sell-off

NEW YORK: Wall Street stocks tumbled early Tuesday, joining a global sell-off as markets worry about a long-running Middle East war boosting oil prices and inflation.

About 20 minutes into trading, the Dow Jones Industrial Average was down 2.2% at 47,837.16.

The broad-based S&P 500 shed 1.9% to 6,749.42, while the tech-rich Nasdaq Composite Index slid 2% to 22,300.67.

US stocks also opened decisively lower on Monday but strengthened throughout the day as investors appeared to bet on a fairly quick resolution that wouldn’t lead to a sustained hike in energy prices.

But investors were more pessimistic on Tuesday.

“Overnight, what we realized was that this is not going away so quickly” and is “meeting the standards of having a broad geopolitical impact,” said Steve Sosnick of Interactive Brokers.

READ MORE: US stocks fall as Middle Eastern war lifts oil prices

Oil prices surged again on Tuesday as Iran attacked additional energy facilities. Drones struck a fuel tank in Oman, and in the UAE an oil storage zone was hit by falling debris from an intercepted drone.

The Strait of Hormuz, a key transport waterway, remained effectively empty.

“US investors can only trust their positive psychology to some extent before they realize that, ‘Wait a minute, if this is a problem for everyone else in the world, maybe this should be a problem here too,’” Sosnick said.

We’re talking about “something that could have an important inflationary impact,” he added.