US Stocks Decline on Geopolitical Tensions, Monday, July 13, 2026

Market Wrap

US equities ended lower on Monday, with major indices experiencing declines. The Dow Jones Industrial Average fell, recording a decrease of up to 0.28% to 52489.67 according to one source, while another indicated a fall of 0.26% to 52498.64. The S&P 500 declined, with one source reporting a 0.75% drop to 7518.73, and another a 0.68% fall. The Nasdaq Composite saw the steepest declines, falling by as much as 1.49% to 25889.00 in one report and up to 1.55% in another. The Russell 2000 also finished lower, declining by 1.02% to 2947.41 according to one source and 0.83% according to another.

What Drove It

The primary driver for Monday's market downturn was heightened geopolitical tension stemming from renewed US-Iran hostilities. President Donald Trump announced the reinstatement of a blockade on Iranian ports, including the Strait of Hormuz. This action rattled investor sentiment and increased risk aversion in the markets. The news promptly sent oil prices higher, further influencing market dynamics.

Concerns about artificial intelligence (AI) also played a role in the Nasdaq's decline, with "AI jitters" noted as a contributing factor. Additionally, the broader tech sector weighed on US stocks.

Sector Highlights

Memory-chip makers were among the leading laggards on the S&P 500. Shares of SK Hynix, a prominent chip manufacturer, declined significantly in Seoul, falling over 15.4% and logging its steepest daily fall on record. This came after the company's strong Nasdaq debut the previous Friday. The decline in SK Hynix's US shares also contributed to the chip sector's weakness. Despite the sharp pullback, some analysts suggested this decline might be temporary, citing strong structural AI demand. Technology shares broadly weighed on the market. The KBW Nasdaq Bank Index also registered a slight decline, falling between 0.11% and 0.73%.

Precious Metals & Commodities

The geopolitical developments had a notable impact on commodities. Crude oil prices rallied significantly on the news of renewed US-Iran hostilities and the blockade of Iranian ports. Crude oil prices rose by as much as 9.55% to $78.23 according to one source, and 8.96% to $77.81 according to another. However, another source indicated a more moderate increase of 4.48% to $74.61 later in the day. The S&P GSCI Index Spot, a broader commodity index, also advanced, rising between 1.12% and 3.48% across different reports.

In contrast, precious metals experienced declines. Gold fell from 2.26% to 2.67%, with prices reported between $4003.70 and $4020.90 depending on the source.

The US Dollar Index (DXY) rose, increasing by 0.27% to 97.50 in one report and 0.29% to 97.52 in another. However, later in the day, the Dollar Index was reported to have risen by 0.12% to 97.35, or even declined slightly by 0.06% to 97.18. The dollar gained against the yen and the euro.

US Treasury yields also rose. The 10-year US Treasury yield increased, although specific changes were reported inconsistently across sources, with some indicating a decrease in value but an increase in yield from 4.578% to 4.625%.

The VIX, a measure of market volatility, advanced significantly, rising between 8.92% and 15.64%.

What to Watch Tomorrow

Investors will likely continue to monitor developments in the Middle East, particularly concerning US-Iran relations and their potential impact on oil prices and global supply chains. Attention will also remain on the semiconductor sector for any further indications of demand or supply shifts, especially given SK Hynix's recent performance.

Bottom Line

Monday's market session was largely characterized by a retreat from risk assets due to escalating geopolitical tensions between the US and Iran, which drove oil prices higher and weighed on broader market sentiment. Long-term investors may consider this a period to observe how global events influence market stability and commodity prices, without reacting to short-term volatility.

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