Volkswacht Bodensee - US stocks fall again as Iran worries lift oil prices

Executives with Citigroup, Bank of America and Wells Fargo described US consumers as resilient while releasing a batch of generally good earnings with no major bombshells.

But shares of all three banks fell decisively.

The broader market was also not buoyed by US data for November that showed a 0.6 percent increase in retail sales, topping expectations.

Major indices spent most of the day firmly in the red, with the S&P 500 closing down 0.5 percent.

"Investor attitudes are changing," said Jack Ablin of Cresset Capital Management. "Some negativity is creeping in."

Ablin described investor unease about President Donald Trump's threats to Federal Reserve autonomy, most recently in the Department of Justice's criminal probe of the central bank.

He also pointed to Trump's proposed 10 percent interest rate cap on credit cards as an unwelcome wildcard that has added to a broader sense of unpredictability.

There's "uncertainty around these capricious policies and markets are already expensive," Ablin said.

Other topics that have dominated headlines include Trump's ambitions to take over Greenland that have raised worry in Europe and a rise in rhetoric between the United States and Iran over the latter's handling of protests.

The latter issue helped propel oil prices about 1.5 percent higher.

Iran warned the United States that it was capable of responding to any attack, as Washington appeared to be pulling personnel out of a base that Iran targeted in a strike last year.

"Traders are closely watching the political unrest in Iran and possible US intervention, which could threaten disruption to the country's...oil production," said Helge Andre Martinsen, senior energy analyst at DNB Carnegie.

In European stocks trading London set a fresh all-time high thanks to gains in mining stocks, but Frankfurt and Paris slid lower.

Asian stock markets mostly gained.

Tokyo shares jumped by 1.5 percent while the yen slumped to its lowest value since mid-2024 amid media reports that Prime Minister Sanae Takaichi planned to hold an election as soon as February 8.

Takaichi's cabinet -- riding high in opinion polls -- has approved a record 122.3-trillion-yen ($768 billion) budget for the fiscal year from April 2026.

She has vowed to get parliamentary approval as soon as possible to address inflation and shore up the world's fourth-largest economy.

On the corporate front, British energy giant BP revealed a write-down of up to $5 billion linked to its energy transition efforts that will be reflected in the company's upcoming annual results.

Its share price traded lower most of the day but closed the day with a gain of 1.5 percent.

- Key figures at around 2115 GMT -

Brent North Sea Crude: UP 1.6 percent at $66.52 per barrel

West Texas Intermediate: UP 1.4 percent at $62.02 per barrel

New York - Dow: DOWN 0.1 percent at 49,124.17 points

New York - S&P 500: DOWN 0.7 percent at 6,917.81

New York - Nasdaq Composite: DOWN 1.1 percent at 23,440.38

London - FTSE 100: UP 0.5 percent at 10,184.35 (close)

Paris - CAC 40: DOWN 0.2 percent at 8,330.97 (close)

Frankfurt - DAX: DOWN 0.5 percent at 25,286.24 (close)

Tokyo - Nikkei 225: UP 1.5 percent at 54,341.23 (close)

Hong Kong - Hang Seng Index: UP 0.6 percent at 26,999.81 (close)

Shanghai - Composite: DOWN 0.3 percent at 4,126.09 (close)

Euro/dollar: UP at $1.1647 from $1.1641 on Tuesday

Pound/dollar: DOWN at $1.3433 from $1.3465

Dollar/yen: DOWN at 158.56 yen from 158.14 yen

Euro/pound: DOWN at 86.68 pence from 86.64 pence

burs-jmb/sla

R.Flueckiger--VB