S&P 500 Plunges as Middle East Conflict Escalates

On Tuesday, the S&P 500 declined as investors moved away from riskier assets, driven by growing concerns of a broader conflict in the Middle East following Iran's missile attack on Israel.

By 4:00 p.m. ET (2000 GMT), the Dow Jones Industrial Average had lost 173 points, or 0.4%, the S&P 500 had dropped 1%, and the NASDAQ Composite fell by 1.5%.

Despite the day's losses, all three major U.S. indexes posted gains in September and the third quarter, marking the first time the S&P 500 saw a positive September since 2019.

For the year, the S&P 500 has surged by over 20%, the first time since 1997 that the index has achieved such significant growth within the first nine months of a year.

Iran Launches Missiles in Israel

Iran launched ballistic missiles targeting Israel on Tuesday, according to the Israeli military, escalating tensions in the already volatile, oil-rich Middle East. The conflict now risks drawing in other regional powers, including the United States.

Sky News Arabia reported that Iran had notified international parties in advance about the timing and scale of its missile strike. In response, Israel signaled plans for strong airstrikes, raising the possibility of a retaliatory attack on Tehran.

This development comes as Israeli forces initiated "limited" operations against Hezbollah near the Lebanon border.

Fears of a broader Middle East conflict drove oil prices higher due to concerns over supply disruptions, while defense stocks also saw notable gains.