Stocks edged lower in late-afternoon trading Tuesday after President Donald Trump announced the United States’ withdrawal from a landmark nuclear deal with Iran. Crude oil prices, which fell sharply ahead of the afternoon announcement, pared some of their early losses. Gains in banks and industrial companies were outweighed by losses in health care and consumer goods stocks.
KEEPING SCORE: The S&P 500 index fell 3 points, or 0.1 percent, to 2,669 as of 3:36 p.m. Eastern Time. The Dow Jones industrial average lost 10 points to 24,346. The Nasdaq slid 6 points, or 0.1 percent, to 7,258. The Russell 2000 index of smaller-company stocks rose 5 points, or 0.4 percent, to 1,584.
IRAN DECISION: President Donald Trump said Tuesday afternoon that the United States is withdrawing from the Iran nuclear deal, which he called “defective at its core.” The move reinstalls sanctions on the Iranian regime. The 2015 agreement required Iran to curb its nuclear enrichment program in exchange for relief from international sanctions.
Several companies, including Airbus, Boeing and Total, have struck business deals in Iran and could be looking for exemptions if U.S. sanctions are imposed again. Boeing shares fell 0.7 percent to $338.57, while Total dipped 0.4 percent to $61.74.
THE QUOTE: “At least for the moment the movement in oil is moderate and seems to be more or less what the market was expecting,” said Phil Guarco, global investment specialist, J.P. Morgan Private Bank. “While this is big news, it is not something that the market hadn’t already priced in. Now we have to see what the reactions are.”
ENERGY: Oil prices trimmed some of their losses from earlier in the day. Benchmark U.S. crude oil fell $1.67, or 2.4 percent, to $69.06 per barrel in New York. Uncertainty over whether the U.S. would pull out of the Iran pact helped lift the price of crude on Monday above $70 a barrel for the first time since November 2014.
On Tuesday, Brent crude, which is used to price international oils, lost $1.32, or 1.7 percent, to $74.85 per barrel in London.
So why didn’t prices keep climbing Tuesday?
“It’s all really in the expectations,” Guarco said. “The market was pricing in something even more aggressive. Still, things are very fluid and oil markets could turn on a dime if it seemed that the potential for a supply disruption got meaningfully larger.”
The slide in oil futures weighed on some energy stocks. Helmerich & Payne lost 0.7 percent to $68.17.
DOUBLE DOSE: Shire rose 4.6 percent to $40.35 after the Ireland-based pharmaceutical company agreed to be acquired by Japanese drugmaker Takeda in a deal worth $62.4 billion. Shares in Takeda slipped 0.7 percent to $20.85.
RIVALS NO MORE: Xcerra gained 3.2 percent to $13.25 after the semiconductor equipment testing company accepted a cash and stock offer valued at $764.4 million from competitor Cohu. Shares in Cohu tumbled 6.6 percent to $21.81.
FOX CATCHER: Comcast fell 5.3 percent to $30.68 after Reuters reported that the company wants to make a new offer for the entertainment businesses that Twenty-First Century Fox agreed to sell to Disney. Shares in Fox slipped 0.1 percent to $38.01. Disney slid 0.9 percent to $101.52.
BOND YIELDS: Bond prices fell. The yield on the 10-year Treasury rose to 2.97 percent from 2.95 percent late Monday. The rise in yields pushed up interest rates, which allows banks to make more money from loans. That helped drive financial sector stocks higher. Capital One Financial rose 1.5 percent to $90.24.
CURRENCIES: The dollar fell to 109.02 yen from 109.06 yen on Monday. The euro weakened to $1.1858 from $1.1923.
METALS: Gold dipped 40 cents to $1,313.70 an ounce. Silver dropped 2 cents to $16.47 an ounce. Copper lost 2 cents to $3.06 a pound.
MARKETS OVERSEAS: In Europe, Germany’s DAX dropped 0.3 percent while the CAC 40 in France lost 0.2 percent. Britain’s FTSE 100 was flat. Major indexes in Asia finished mixed. Japan’s Nikkei 225 stock index added 0.2 percent and Hong Kong’s Hang Seng index climbed 1.4 percent. South Korea’s Kospi gave up early gains to lose 0.5 percent. Australia’s S&P ASX 200 edged 0.1 percent higher. Shares rose higher in Singapore and Taiwan, but fell 1.9 percent in Indonesia after the government reported economic growth slowed in January-March.