Stock Market Update

[BRIEFING.COM] The major averages remain under pressure at midday, with the S&P 500 (-0.5%), Nasdaq Composite (-0.4%), and DJIA (-0.7%) trading firmly lower as rising oil prices and renewed hostilities between the U.S. and Iran weigh on sentiment.

Crude oil is up $1.98 (+2.4%) to $85.38 per barrel, recovering a large portion of last week's decline. The move has provided a clear boost to the energy sector (+1.0%), which is the lone S&P 500 sector trading higher, while contributing to broader pressure elsewhere in the market.

The weakness is widespread beneath the major averages. Decliners outpace advancers by greater than a 2-to-1 margin on both the NYSE and Nasdaq, while the Russell 2000 (-0.8%) and S&P Mid Cap 400 (-0.6%) underperform the S&P 500.

Mega-cap stocks are also providing little support overall, leaving the Vanguard Mega Cap Growth ETF down 0.5%. The communication services sector (-1.8%) holds the widest loss as Alphabet (GOOG 334.79, -8.09, -2.36%) and Meta Platforms (META 571.44, -6.58, -1.14%) trade lower. However, Tesla (TSLA 366.20, +17.45, +5.00%) is up sharply and has pushed back above its 50-day moving average amid enthusiasm surrounding autonomous driving developments and Elon Musk's ambitious solar-energy production plans.

The information technology sector (flat) has held up considerably better than most of the market. NVIDIA (NVDA 220.00, +2.46, +1.13%) remains higher following last week's post-earnings surge as the PHLX Semiconductor Index (+0.2%) trades modestly higher.

CrowdStrike (CRWD 227.06, +8.66, +3.97%) is another standout, extending its post-earnings rally following a series of product, cloud, and partnership announcements that reinforced enthusiasm surrounding the company's expanding AI-era cybersecurity platform.

Elsewhere, the industrials sector (-1.2%) is being weighed down in part by continued weakness across military contractors. The SPDR S&P Aerospace & Defense ETF is down more than 2.0%, while Howmet Aerospace (HWM 242.40, -22.45, -8.48%) has fallen sharply to its lowest level since early June and is testing the area around its 200-day moving average. The stock has come under pressure after Musk said in-house SpaceX (SPCX 143.00, +1.50, +1.06%) casting of natural-gas turbine blades and vanes could accelerate turbine deployment by up to 18 months.

The real estate sector (-1.2%) is also among the weakest groups, while the utilities sector (-1.0%) faces continued pressure from sharp losses in Edison (EIX 53.18, -16.99, -24.21%) and PG&E (PCG 13.42, -3.18, -19.19%). Both stocks have sold off following developments surrounding California wildfire legislation, which is expected to result in return-on-equity cuts for power companies.

In other corporate news, Aon (AON 328.95, -26.45, -7.44%) is down roughly 7.0% after agreeing to acquire USI Insurance Services for $17.0 billion in cash.

Overall, today's weakness has been broad, with rising crude oil prices providing another source of pressure at the start of the week. The energy sector is benefiting from the move, while relative strength in select technology and mega-cap names has helped limit the losses for the major averages despite considerably weaker market breadth.

There is no economic data of note.