Oil Spikes 7%, Nasdaq 100 Sinks Before Fed: Stock Market Today

A deepening sell-off gripped Wall Street midday Wednesday as crude oil spiked on a fresh U.S.-Iran escalation just hours before the Federal Reserve’s rate verdict, dragging the S&P 500 to four-week lows and knocking the Nasdaq 100 down more than 10% from prior records.

President Donald Trump threatened strikes against Iran in response to attacks on U.S. targets in Jordan.

The threat landed alongside a new round of Treasury sanctions aimed at what officials called Iran’s Strait of Hormuz “monetization.” That was enough to reignite the energy trade and drain risk appetite. • State Street Energy Select Sector SPDR ETF shares are advancing steadily.

Why is XLE stock trading higher? West Texas Intermediate crude surged 6.7% to $84.58 a barrel, bringing its one-month gain to roughly 22%, while Brent jumped 7.4% to $90.27.

An outsized inventory draw amplified the oil move: EIA data showed U.S. crude stockpiles fell by 7.2 million barrels last week — against expectations for a build — leaving commercial inventories excluding the Strategic Petroleum Reserve at their lowest since September 2018.

The oil shock could hardly come at a worse time for the Fed, which wraps its two-day meeting at 2 p.m.

ET.

Markets overwhelmingly expect Chair Kevin Warsh to hold the funds rate at 3.50%-3.75%, but with inflation still running near 4% and several officials penciling in hikes this year, dissents are the wild card.

Polymarket puts 74% odds on no change and a 25% chance of a quarter-point hike.

The S&P 500 fell 1% to 7,358, a four-week low, while the Dow Jones shed 860 points, or 1.6%, to 51,887.

The Nasdaq 100 dropped 1.5% to 27,349 and is now off nearly 10% in July as the AI-capex rethink deepens.

Microsoft Corp. (NASDAQ: MSFT ) and Meta Platforms Inc. (NASDAQ: META ) slipped about 0.5% ahead of their after-the-bell reports.

The CBOE Volatility Index jumped nearly 10% to the 20 mark, reflecting hedging demand into the Fed announcement and tonight’s megacap earnings.

Wednesday’s Performance In Major U.S.

Indices Index Last % Change S&P 500 7,358 -1% Dow Jones 51,887 -1.6% Nasdaq 100 27,349 -1.5% Russell 2000 2,913 -1.4% Updated by 12:00 p.m.

ET According to the Pro platform: The Vanguard S&P 500 ETF (NYSE: VOO ) slipped 0.9%.

The SPDR Dow Jones Industrial Average ETF Trust (NYSE: DIA ) shed 1.6%.

The Invesco QQQ Trust (NASDAQ: QQQ ) dropped 1.5%.

The iShares Russell 2000 ETF (NYSE: IWM ) eased 1.4%.

Sector Movers The Energy Select Sector SPDR Fund (NYSE: XLE ) rallied 2.4%, extending its July advance to roughly 11% and pacing all sectors, while the Consumer Staples Select Sector SPDR Fund (NYSE: XLP ) added 0.8% and the Health Care Select Sector SPDR Fund (NYSE: XLV ) was down 0.2%.

At the other end, the Industrials Select Sector SPDR Fund (NYSE: XLI ) tumbled 2.66% while the Technology Select Sector SPDR Fund (NYSE: XLK ) and the Materials Select Sector SPDR Fund (NYSE: XLB ) each lost 1.7%.

XLK is now down nearly 12% in July.

Among industry funds, the Invesco WilderHill Clean Energy ETF (NYSE: PBW ) slumped 3.3%, deepening a brutal 23% monthly slide.

Earnings Movers Earnings drove the single-stock tape.

Manhattan Associates, Inc. (NASDAQ: MANH ) exploded 27.1% higher after Tuesday evening’s blowout print: second-quarter EPS of $1.39 topped the $1.32 consensus on revenue of $297.8 million versus $287.8 million expected.

Garmin Ltd. (NYSE: GRMN ) surged 17.3% after smashing estimates this morning with EPS of $2.81 versus $2.30 and revenue of $2.02 billion against $1.94 billion, while ExlService Holdings, Inc. (NASDAQ: EXLS ) climbed 16.3% on a double beat of its own: EPS of 59 cents versus 55 cents on revenue of $594.8 million versus $568.4 million.

Lithia Motors, Inc. (NYSE: LAD ) jumped 16.3% after crushing the consensus with $10.03 in quarterly EPS versus $8.71 expected, and Avantor, Inc. (NYSE: AVTR ) rallied 12.9% after topping estimates with adjusted EPS of 21 cents on $1.69 billion in revenue and raising full-year organic growth and profit guidance.

The software and IT-services glow spread wide: Cognizant Technology Solutions Corp. (NASDAQ: CTSH ) gained 11.2%.

Morning beats also lifted Automatic Data Processing Inc. (NASDAQ: ADP ), up 5.5% after EPS of $2.64 beat the $2.59 estimate, and Amphenol Corp. (NYSE: APH ), up 5.5% on EPS of $1.35 versus $1.16.

Mondelez International Inc. (NASDAQ: MDLZ ) rose 4.9% on last night’s beat, and Visa Inc. (NYSE: V ) rebounded 1% after posting quarterly revenue growth.

The losers’ column was uglier.

Parsons Corp. (NYSE: PSN ) cratered 35.1% after flat second-quarter revenue of $1.58 billion missed estimates, the company swung to a $15 million net loss on roughly $118 million of contract and joint-venture charges, and management slashed full-year adjusted EBITDA guidance to $500 million-$560 million from $615 million-$675 million.

Lennox International Inc. (NYSE: LII ) plunged 20.5% after quarterly revenue of $1.5 billion missed the $1.55 billion consensus despite an EPS beat.

Peer Watsco, Inc. (NYSE: WSO ) shed 16% after posting $4 per share against a $4.39 estimate as operating margin compressed to 11.3% from 13.2%, and fellow HVAC name AAON, Inc. (NASDAQ: AAON ) dropped 8%.

V.F.

Corp. (NYSE: VFC ) slid 18.1% after posting a wider-than-expected quarterly loss of 27 cents per share versus a 22-cent loss consensus.