Stocks Slide as Rising Oil, Higher Yields, and Retail Weakness Pressure the Market

Stocks steadily lost ground throughout Thursday’s session, with selling accelerating into the close as rising oil prices, higher interest rates, and weakness across retail and mega-cap stocks weighed on sentiment. The S&P 500 fell 0.9%, the Nasdaq Composite declined 1.0%, and the Dow Jones Industrial Average dropped 1.3%, with all three major averages ending near their session lows.

Thursday’s trading represented a reversal of some of Wednesday’s rate-relief rally. The Treasury Department’s announcement that it would increase the size of its liquidity-support buybacks had pushed longer-term yields lower and fueled broad buying across rate-sensitive areas in the previous session. Some of that relief faded Thursday as Treasury yields resumed their climb, creating a less favorable backdrop for equities.

Oil prices added another layer of pressure after President Trump threatened renewed economic measures against Iran. Treasury Secretary Scott Bessent later said he plans to hold a press conference Monday to discuss additional actions against the country, describing the potential effort as the “greatest coordinated economic isolation in the history of the world.” WTI crude extended its recent advance, settling $2.47 higher, or 2.9%, at $88.15 per barrel.

The combination of higher interest rates and rising oil prices weighed particularly heavily on consumer discretionary stocks. The sector fell 1.8%, with cruise operators, homebuilders, and apparel companies among the notable laggards. The iShares U.S. Home Construction ETF dropped 2.5%, reversing some of Wednesday’s rate-driven rebound. Advance Auto (AAP 42.39, -13.79, -24.55%) plunged following its earnings report, dragging other auto-parts stocks lower as well.

Retail weakness extended into the defensive consumer staples sector (-1.9%), which suffered one of the session’s steepest declines. Walmart (WMT 103.84, -10.46, -9.15%) sank more than 9% after its earnings report included a disappointing third-quarter outlook, adding considerable pressure to the broader retail complex.

Industrials (-1.2%) also struggled as higher crude prices weighed on transportation stocks. Airlines retreated amid renewed concerns about fuel costs, while defense contractors came under pressure as the U.S. emphasized economic measures rather than military action against Iran. The iShares U.S. Aerospace & Defense ETF fell 3.6%.

There were nevertheless some notable earnings-related winners within the industrial sector. Deere (DE 620.94, +40.31, +6.94%) rallied nearly 7%, while Nordson (NDSN 334.70, +24.78, +8.00%) jumped 8% following its quarterly results.

Health care (-1.9%) was another significant source of weakness. Moderna (MRNA 133.32, -41.06, -23.55%) surrendered another substantial portion of Wednesday’s extraordinary rally following positive cancer-vaccine results. Intuitive Surgical (ISRG 374.48, -23.24, -5.84%) also posted a sizable decline.

Technology stocks held up considerably better than most of the market. The information technology sector slipped just 0.4%, making it one of the session’s better-performing groups. More importantly, semiconductor stocks finally showed some resilience after two consecutive sessions of steep declines. The PHLX Semiconductor Index gained 0.5%, supported by rebounds across memory stocks and several other chipmakers following the pronounced volatility that has characterized the group this week.

That resilience did not extend to mega-cap growth stocks more broadly. The Vanguard Mega Cap Growth ETF declined 0.9%, adding pressure to the market-cap-weighted indices as selling intensified during the afternoon.

By the closing bell, energy (+0.4%) and real estate (+0.2%) were the only two S&P 500 sectors to finish in positive territory, underscoring the breadth of Thursday’s retreat.

Crypto-related stocks provided another isolated pocket of strength. Coinbase Global (COIN 172.35, +12.15, +7.58%) ranked among the S&P 500’s best-performing components as President Trump’s push for Congress to pass the CLARITY Act helped fuel renewed buying across cryptocurrency-linked stocks.

Weakness was not confined to the large-cap benchmarks. The Russell 2000 fell 1.3%, while the S&P MidCap 400 declined 0.9%, with both finishing near their session lows as higher borrowing costs and rising energy prices pressured the broader market.

Thursday’s steady deterioration reflected a difficult combination of macroeconomic and company-specific headwinds. The reversal of some of Wednesday’s rate relief, a nearly 3% jump in crude oil prices, and disappointing reactions to several major retail earnings reports combined to undermine sentiment throughout the session.

Semiconductor stocks offered a rare source of resilience after their recent sharp declines, but their modest rebound was insufficient to counter weakness across mega-cap growth stocks and an increasingly broad market retreat. With the major averages closing at their worst levels of the day, rising oil prices and Treasury yields have once again emerged as important obstacles for a market attempting to stabilize after a volatile stretch.

Our FTinvest 11 model portfolio declined 1.24% to close at 1,060.98, reversing much of the previous session’s strong rebound. The portfolio remains comfortably above the 1,000 level, although today’s decline moves it approximately 3.2% below its all-time closing high of 1,096.33.

FTinvest 11 is now up approximately +14.31% year-to-date, continuing to maintain a strong double-digit return for 2026. Recent sessions have shown increased back-and-forth volatility, with Wednesday’s +1.63% rebound followed by today’s -1.24% decline, reinforcing the broader pattern of consolidation that has developed since the portfolio reached record territory in July.

Despite the short-term fluctuations, FTInvest 11 continues to preserve the majority of its 2026 gains and remains relatively close to its all-time high. Its disciplined, value-driven investment approach remains focused on long-term capital appreciation rather than individual daily market movements.