Dow tanks over 600 points as oil surge, Alphabet and Tesla earnings weigh on markets

• Brent crude rose 6% above $99/barrel and WTI climbed 5% above $91/barrel after Houthi attacks on Saudi tankers and Trump's warning to bomb Iranian infrastructure for any future attacks in the Strait of Hormuz
• Alphabet shares fell despite beating earnings estimates due to plans to increase AI infrastructure spending, while Tesla disappointed with a 14% revenue decline and operating expenses growing faster than revenue
• Weekly jobless claims dropped to 187,000, the lowest level since 1969, signaling labor market resilience but reinforcing inflation concerns as energy prices surge

Market Summary: Dow Drops 600+ Points on Oil Surge and Tech Earnings

Market Performance:

US equities sold off sharply on Thursday, with the Dow Jones falling 604 points (-1.2%), the S&P 500 declining 1.2%, and the Nasdaq Composite dropping 1.8%.

Key Drivers:

*Oil Price Surge:* Brent crude jumped 6% to above $99/barrel (briefly touching $100), while WTI crude climbed 5% to over $91/barrel—the highest levels since before a recent US-Iran agreement. The surge followed Houthi attacks on Saudi oil tankers in the Red Sea and President Trump's threat of military retaliation against Iranian infrastructure for any future attacks in the Strait of Hormuz.

*Tech Earnings Disappointment:* Alphabet and Tesla weighed heavily on technology stocks. Alphabet faced investor concern over increased AI-related capital expenditure, while Tesla reported rising operating expenses that outpaced revenue growth during the quarter.

*Inflation Concerns:* Higher oil prices pushed the 10-year Treasury yield to its highest level since January 2025, intensifying worries about persistent inflation and the interest rate outlook.

Economic Data:

Weekly jobless claims fell to 187,000 (from 209,000 the prior week)—the lowest level since 1969—indicating continued labor market strength but raising concerns that tight employment conditions could fuel inflation alongside rising energy costs.

Market Implications:

The combination of geopolitical risk, surging commodity prices, disappointing tech earnings, and resilient employment data creates a challenging environment for equities. Investors face the prospect of "higher-for-longer" interest rates as energy-driven inflation pressures mount, particularly weighing on rate-sensitive sectors and high-multiple growth stocks.