US stock market trend | Dow Jones closes down 84 points, having fallen as much as 438 points during the session

International oil prices regain upward momentum, and concerns about the private credit market reignite, causing U.S. stocks to come under pressure again on Tuesday. The Dow opened down 108 points, with the decline expanding to as much as 438 points, hitting a low of 45,769 points; the S&P 500 once fell 0.85%, and the tech-heavy Nasdaq dropped 1.07%. New York crude oil futures surged 5.9% to $93.36 per barrel, closing at $92.35, still up 4.79%; Brent crude oil rose 4.55%, closing at $104.49.

International oil prices close up more than 4%

Among major stocks, Microsoft closed down 2.7%, Meta and Alphabet fell 1.8% and 3.8% respectively, Salesforce declined 6.2%, the worst performer among Dow components, while Cisco rose 2.6%, the biggest gain among Dow stocks. Alternative asset manager Ares announced restrictions on redemptions of a private credit fund with $10.7 billion in assets, dragging its stock down 1%, while Apollo and KKR initially fell but later stabilized.

Renewed concerns over private credit

The Financial Times reports that Japan’s second-largest bank, Sumitomo Mitsui, is preparing plans for a potential acquisition of Jefferies, which it already holds shares in. Jefferies’ stock rose 2.5%.

In the U.S. market, the Dow fluctuated and retreated 84 points, or 0.18%, to 46,124; the S&P 500 fell 0.37% to 6,556; the Nasdaq dropped 0.84% to 21,761; the Golden Dragon Index, reflecting Chinese concept stocks, retreated 0.43% to 6,771. European stocks showed mixed performance, with the UK and France up 0.72% and 0.23%, respectively, while Germany declined 0.07%. Bloomberg cited sources saying the European Central Bank is conducting a new round of reviews on the loan quality and exposure of private credit firms, with Deutsche Bank and Societe Generale both falling 0.5%.

Citadel Securities believes that the impact of the Middle East war on the markets is entering a new phase. Investors are shifting focus from inflation shocks to the potential blow to the global economy. The firm notes that economic weakening and demand destruction could benefit long-term bonds adjusted for inflation, and that USD call options could hedge against further escalation of the conflict.

10-year U.S. Treasury yields rise 9.7 basis points then stabilize

The yield on the 10-year U.S. Treasury briefly rose 9.7 basis points to 4.43%, then significantly retreated; the 2-year Treasury yield, which is more sensitive to interest rate expectations, increased 13 basis points to 3.961%. Mary Daly, President of the San Francisco Federal Reserve, said on social media platform X that the Fed needs to keep policy flexible to respond to rapidly changing risks, noting that providing too much forward guidance in an uncertain global environment could reduce, rather than improve, policy transparency.

The U.S. manufacturing PMI for March rose from 51.6 in February to 52.4, beating expectations of 51.5. Meanwhile, the services PMI declined from 51.7 in February to 51.1, below the estimate of 52, with the composite PMI falling to 51.4.

U.S. dollar rebounds, gold prices halt nine-day losing streak

The U.S. dollar index rose 0.68% to 99.62. The Eurozone’s March composite PMI fell to a 10-month low of 50.5, and the euro depreciated 0.49% to $1.1558. The yen declined 0.47% to 159.19 per dollar. Bitcoin, the leading cryptocurrency, briefly retreated 3.4% to $68,920.

In commodities, gold was sold off to cover losses elsewhere, with spot gold dropping as much as 2.29%, hitting a low of $4,306.36 per ounce, before recovering 1.04% to $4,452.88, temporarily ending a nine-day losing streak. London copper futures fell as much as 2.27% to $11,908 per ton.

Suki Cooper, head of global commodities research at Standard Chartered, said that the recent correction in gold prices was larger than usual, but added that in extreme market stress, a decline lasting 4 to 6 weeks is not uncommon. Additionally, Bloomberg reports that the Central Bank of Turkey is considering using its $135 billion in gold reserves to defend the lira’s exchange rate.