Financial Markets                      05/04 15:22

   

   NEW YORK (AP) -- The U.S. stock market fell from its record heights Monday, 
while oil prices jumped following escalations in the Middle East that may 
undermine the ceasefire in the war with Iran.

   The S&P 500 sank 0.4%, coming off its latest all-time high. The Dow Jones 
Industrial Average dropped 557 points, or 1.1%, and the Nasdaq composite 
slipped 0.2%.

   The action was stronger in the oil market, where the price for a barrel of 
Brent crude leaped 5.8% to settle at $114.44. It jolted higher after the United 
Arab Emirates, a U.S. ally, said it came under attack by Iran for the first 
time since the ceasefire took hold in early April. The attacks appeared to be 
in response to U.S. President Donald Trump's latest efforts to reopen the 
Strait of Hormuz.

   Iran's closure of the strait has kept oil tankers pent up in the Persian 
Gulf and away from customers worldwide. That in turn has sent the price of 
Brent soaring from roughly $70 per barrel before the war.

   Trump said Sunday that the United States would guide ships through the 
strait, which could get oil flowing again and bring down its price. But prices 
instead climbed with uncertainty about what would happen next.

   The U.S. military said Monday that two American-flagged merchant ships had 
successfully transited the Strait of Hormuz. It also said that it sank six 
small boats as it set up an "enhanced security area" for ships crossing the 
strait.

   Even with all the uncertainty about how long the war with Iran will last, 
the U.S. stock market has remained remarkably resilient and has powered to 
record after record. Hope is still high on Wall Street that the global economy 
can avoid a worst-case scenario because of the war. And in the meantime, 
companies continue to deliver big growth in profits. That's key because stock 
prices tend to follow the path of corporate profits over the long term.

   The strength so far this reporting season has been broad-based and not 
confined to just the Big Tech superstars that dominate the market. The median 
stock in the S&P 500 is tracking for the best growth since 2021, according to 
Savita Subramanian, a strategist at Bank of America.

   Tyson Foods joined the list Monday of those topping analysts' expectations 
for both profit and revenue during the latest quarter.

   It sold less beef than it did a year ago, but it did so at prices that were 
11.5% higher, so its total beef revenue edged up. It also sold more chicken and 
pork than a year earlier, at slightly higher prices. Its stock rose 8% and 
helped limit Wall Street's losses.

   Norwegian Cruise Line Holdings likewise delivered a better profit for the 
latest quarter than analysts expected. But it's feeling the effects of the war, 
which has not only raised pressure on fuel prices but also pushed customers to 
think twice about travel plans, particularly to Europe.

   The cruise operator said some "execution missteps" also have bookings below 
where it would like, and its stock fell 8.6%.

   UPS and FedEx dropped even more for some of the market's sharpest losses 
after Amazon announced a move that could cut into their businesses. The online 
giant said it's begun allowing Procter & Gamble, 3M and other big companies to 
use its logistics services to move inventory, fulfill orders and deliver 
packages directly to shoppers.

   UPS dropped 10.5%, and FedEx fell 9.1%, while Amazon rose 1.4%.

   GameStop slumped after it said it wants to buy eBay, a much larger company, 
for $125 per share in cash and stock. Coming into the day, eBay had a total 
market value that was nearly quadruple GameStop's.

   GameStop said it has already built a 5% stake in eBay and sees opportunities 
to cut $2 billion in annual costs quickly. GameStop, whose stock briefly soared 
to market-shaking heights during the meme stock craze of 2021, fell 10.1%, 
while eBay rose 5.1%.

   All told, the S&P 500 fell 29.37 points to 7,200.75. The Dow Jones 
Industrial Average dropped 557.37 to 48,941.90, and the Nasdaq composite 
slipped 46.64 to 25,067.80.

   In stock markets abroad, gains for tech stocks helped indexes jump 5.1% in 
South Korea and 1.2% in Hong Kong, while markets were closed in mainland China 
and Japan for holidays.

   European indexes fared worse, and France's CAC 40 fell 1.7%.

   In the bond market, Treasury yield jumped with the price of oil. The yield 
on the 10-year Treasury rose to 4.43% from 4.39% late Friday. It was at just 
3.97% before the war began, and the rise has made mortgages and other kinds of 
loans for U.S. households and businesses more expensive.

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   AP Business Writers Matt Ott, Anne D'Innocenzio and Elaine Kurtenbach 
contributed.

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