Wall Street falls to its worst drop since the Iran war as the Nasdaq
sinks 10% below its record
[March 27, 2026] By
STAN CHOE
NEW YORK (AP) — Stocks fell sharply Thursday, and oil prices rose as
doubt took over again from hope on Wall Street about a possible end to
the war with Iran.
The S&P 500 slumped 1.7% for its worst day since January and is back on
track for a fifth straight losing week. That stretches back to before
the Iran war began, and it would be the longest such losing streak in
nearly four years.
The Dow Jones Industrial Average dropped 469 points, or 1%, and the
Nasdaq composite sank 2.4% to fall more than 10% below its all-time high
set early this year. That's a steep enough drop that professional
investors have a name for it: a “correction.”
Stock markets likewise tumbled across much of Asia and Europe. They’re
the latest flip - flops for financial markets in a week that began with
big hopes after President Donald Trump said productive talks had taken
place about ending the war. But Iran denied direct talks were underway
and then dismissed a U.S. proposal for a ceasefire that was delivered
via Pakistan.
On Thursday, the fighting continued, and thousands more U.S. troops
neared the region. Iran, meanwhile, tightened its grip on the crucial
Strait of Hormuz. It may be creating something like a “toll booth” for
tankers to get past the narrow waterway, which typically sees a fifth of
the world’s oil exit the Persian Gulf through it to customers worldwide.
The price for a barrel of Brent crude oil climbed 4.8% to settle at
$101.89 as hopes dimmed for a potential return to normal for the strait.
That’s up from roughly $70 before the war began. Benchmark U.S. crude
rose 4.6% to $94.48 per barrel.
“They better get serious soon, before it is too late,” Trump said on his
social media network Thursday morning about Iran’s negotiators, “because
once that happens, there is NO TURNING BACK, and it won’t be pretty!”
Just minutes after Wall Street finished its trading for the day, Trump
softened his talk a bit. He said he was delaying his threat to
“obliterate” Iranian power plants to April 6, allowing more time for
talks.
“Talks are ongoing and, despite erroneous statements to the contrary by
the Fake News Media, and others, they are going very well.”
After that, oil prices trimmed some of their gains, and Brent crude fell
back toward $100 per barrel. Treasury yields also pared their big jumps
in the bond market.
High Treasury yields and disruption in the bond market were big factors
that Trump named a year ago when he backed off his initial threats for
global tariffs made on “Liberation Day.” The moves caused critics to
allege Trump always chickens out, or “TACO,” if financial markets show
enough pain.
The yield on the 10-year Treasury jumped as high as 4.43% Thursday from
4.33% late Wednesday and from just 3.97% before the war started. That’s
a significant leap for the bond market, and it’s already sent rates
higher for mortgages and other kinds of loans for U.S. households and
businesses, which slows the economy.
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James Denaro, center, and Dilip Patel, left, work on the floor at
the New York Stock Exchange in New York, Wednesday, March 25, 2026.
(AP Photo/Seth Wenig)
 A report on Thursday morning said
slightly more U.S. workers filed for unemployment benefits last
week, though the number is still low compared with historical
figures.
A slowing job market would typically encourage the Federal Reserve
to cut interest rates to juice the economy. But hopes have cratered
on Wall Street for a possible cut to interest rates this year, even
though traders came into 2026 forecasting several. That’s because
lower interest rates carry the risk of worsening inflation, and the
spike in oil prices has heightened those worries.
On Wall Street, tech stocks were the heaviest weights on the market.
Meta Platforms fell 8%, and Alphabet sank 3.4% after each had held
relatively steady the day before, when a jury found Instagram and
YouTube liable in a landmark social-media addiction trial.
The financial penalties were small compared with the companies’ vast
profits, but it could herald a watershed moment that invites more
lawsuits.
Other Big Tech stocks also fell, including drops of 4.2% for Nvidia
and 2% for Amazon. Apple was an outlier and inched up 0.1%.
Commercial Metals fell 4.7% after the maker of steel rebar and other
products reported a weaker profit for the latest quarter than
analysts expected. CEO Peter Matt said bad weather hurt its North
American operations during the quarter, but underlying market
conditions looked favorable.
All told, the S&P 500 fell 114.74 points to 6,477.16 and is 7.2%
below its all-time high set a couple months ago. The Dow Jones
Industrial Average dropped 469.38 to 45,960.11, and the Nasdaq
composite sank 521.74 to 21,408.08.
In stock markets abroad, Germany’s DAX lost 1.5%, Hong Kong’s Hang
Seng sank 1.9% and South Korea’s Kospi dropped 3.2%. Japan’s Nikkei
225 had one of the world’s milder losses, at 0.3%.
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AP Business Writers Chan Ho-him and Matt Ott contributed.
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