Dow surges 500 points after four-day slide as oil prices retreat

• Oil prices fell 3% on Friday (WTI to $99.28, Brent to $104.32) but remained on track for 8% weekly gains amid ongoing US-Iran tensions and Middle East supply concerns
• August core CPI rose 0.3% monthly (above 0.2% forecast), pushing Fed rate hike probability to ~90% for next week's meeting and pressuring rate-sensitive growth stocks
• Gasoline jumped 3.9% and accounted for over one-third of overall CPI gains, with the broader energy index up 16.3% year-over-year

Market Summary: Dow Surges as Oil Retreats, Fed Hike Odds Rise

Market Performance:

US equities rebounded sharply on September 11, 2026, after four consecutive sessions of losses. The Dow Jones Industrial Average climbed 520 points (+1.0%), while the S&P 500 gained 0.9% and the Nasdaq Composite rose 0.8%. The Dow's four-day decline represented its longest losing streak since late April.

Oil Market Developments:

Crude prices pulled back despite escalating US-Iran tensions in the Middle East. West Texas Intermediate fell 3% to $99.28/barrel, retreating from the psychologically significant $100 level. Brent crude declined 3.1% to $104.32. However, both benchmarks remained on track for approximately 8% weekly gains, maintaining pressure on inflation concerns.

Inflation and Federal Reserve:

August CPI data showed headline inflation rose 0.4% monthly and 3.4% annually, meeting expectations. Core CPI increased 0.3% monthly (0.1 percentage point above forecast) and 2.4% annually. Energy was a significant driver, with gasoline prices jumping 3.9% and the energy index up 16.3% year-over-year.

The inflation report pushed Fed rate hike probability to approximately 90% for a 25-basis-point increase at next week's policy meeting, according to CME Group's FedWatch tracker.

Market Outlook:

Despite headwinds from higher rates and energy costs, Wells Fargo Investment Institute analysts expressed optimism for year-end gains. Douglas Beath noted investors may look past near-term uncertainties to focus on continued economic growth and robust earnings through 2027.

Sector Impact:

Growth and technology stocks remain vulnerable to rising borrowing costs, while energy sector exposure presents both opportunities and inflation risks.