Thursday’s session ended the way Wednesday’s did, with all three major indices lower and the word “stagflation” circulating more openly on trading floors than at any point since 2022.
The S&P 500 settled at 6,606.49, down 0.27 percent, after falling as much as one percent during the morning session and briefly dipping below its 200-day moving average of 6,619.14 for the first time since May.
The Dow Jones Industrial Average shed 203.72 points, or 0.44 percent, to close at 46,021.43, while the Nasdaq Composite fell 0.28 percent to end at 22,090.69.
All three indices recovered meaningfully from their session lows, where the Dow had been down nearly 500 points and the Nasdaq had fallen as much as 1.4 percent, before buying came in during the final stretch of trade.
The recovery owed something to remarks from Israeli Prime Minister Benjamin Netanyahu, who stated that Iran can no longer enrich uranium or manufacture ballistic missiles after nearly three weeks of conflict, comments that circulated through news wires in the late afternoon and lifted futures above flat in after-hours trading.
Brent Crude, the International benchmark, advanced roughly 1.2 percent to settle at $108.65 per barrel, its highest close since July 2022, while WTI fell modestly by around 0.2 percent to $96.14, reflecting slightly different assessments of short-term supply disruption risk.
The broader concern that oil above $100 will continue feeding into consumer prices, already running at 3.1 percent on the core PCE measure, has pushed June rate hike odds past rate cut odds on the CME FedWatch tool for the first time in this cycle.
Gold, meanwhile, is heading for its worst week since February 1983, down roughly ten percent on the week, a counterintuitive move explained by dollar strength and forced institutional selling under margin pressure rather than any reassessment of its inflation-hedge qualities.
Silver fared worse still, falling more than ten percent on the day and pacing for its worst weekly performance since January, a decline that has confounded investors positioned for commodity inflation beneficiaries heading into spring.
The bond market’s reaction has been equally significant, with Treasuries selling off sharply before bouncing after the Netanyahu remarks, the two-year and ten-year spread widening in a bear steepening that historically signals markets pricing in more inflation ahead rather than more growth.
For the S&P 500 to avoid confirming its first sustained close below the 200-day moving average since May 2025, buyers will need to step in decisively during Friday’s session, and the diplomatic language emerging from Washington and Jerusalem provides just enough cover for that to happen without anyone having to call a genuine inflection point.