The S&P 500 (-0.9%), Nasdaq Composite (-1.0%), and DJIA (-0.8%) finished lower across the board today as investors reacted to another day of higher energy prices amid the conflict in Iran. 

The major indices each traded with losses around 2.5% in the late morning hours, with broad losses and a clear risk-off disposition underscoring the market's fears that a prolonged rise in energy prices could impact inflation readings and affect the Fed's expected monetary policy path. 

Early breadth figures were abysmal, with a nearly 8% surge in oil prices putting broad pressure on the market. 

The early retreat was in some respects a technical move, as the market was well aware of those concerns yesterday but brushed them off to log a mixed finish. 

While the conflict in Iran does not have a clear end in sight as strikes continue, the market found some buying support in the midday hours that helped the major averages finish well above their session lows. 

Following earlier reports that tanker traffic through the Strait of Hormuz had slowed to a standstill, Donald Trump said in the afternoon via Truth Social that the U.S. Development Finance Corporation has been directed to provide insurance to carriers operating in the Persian Gulf after private insurers pulled coverage due to the conflict with Iran. He also indicated that the U.S. Navy could begin escorting tankers through the strait if necessary.

Ultimately oil gave back a chunk of its early gains, with crude oil futures settling today's session $3.35 higher (+4.7%) at $74.58 per barrel. 

All eleven S&P 500 sectors charted lower finishes, though nearly all of them improved considerably from their worst levels. 

The financials sector (-0.2%) came the closest to notching a gain today, with improvements across major banking names helping the sector shed an early loss of nearly 2%. Software-related names such as Jack Henry (JKHY 168.75, +4.55, +2.77%) and PayPal (PYPL 46.38, +0.75, +1.64%) were among the outperformers as the software space mounted another solid rebound effort today. 

The iShares GS Software ETF finished 1.6% higher, helping ease losses in the information technology sector (-1.1%). Workday (WDAY 143.61, +9.60, +7.16%) was the top-performing S&P 500 name today, while Microsoft (MSFT 403.93, +5.38, +1.35%) was a mega-cap standout. 

The sector remained firmly lower throughout the session following a disappointing performance from chipmakers, with the PHLX Semiconductor Index finishing 4.6% lower. 

Elsewhere, the communication services sector (-0.3%) was another relative outperformer today, supported by strength across cellular service names after AT&T (T 28.68, +0.67, +2.39%) reaffirmed its guidance. 

Meanwhile, the materials sector (-2.7%) closed with the widest loss amid a sharp pullback in precious metal prices. 

Target (TGT 120.80, +7.63, +6.74%) and Best Buy (BBY 65.95, +4.36, +7.08%) posted solid gains following their earnings reports, though corporate news flow was largely overshadowed by geopolitical developments and broader market swings today. 

Outside of the S&P 500, the Russell 2000 (-1.8%) and S&P Mid Cap 400 (-1.4%) underperformed today, facing pressure amid diminishing expectations for Fed easing this year. 

While the major averages finished lower, the sharp rebound from late-morning lows suggests that investors are not yet prepared to extrapolate the energy shock into a sustained downturn. For now, price action continues to hinge on developments in oil and the trajectory of the conflict.

U.S. Treasuries ended Tuesday with slight losses in most tenors after a steady rise off their morning lows. The trading day started with an extension of Monday's losses, which lifted yields to their highest levels in nearly three weeks alongside overnight weakness in global equities and other sovereign debt. However, the entire complex climbed off morning lows alongside a weak open on Wall Street. The 2-year note yield settled up one basis point to 3.50%, and the 10-year note yield settled up one basis point to 4.06%. 

There was no economic data of note today.

• S&P Mid Cap 400: +7.5% YTD
• Russell 2000: +5.1% YTD
• DJIA: +0.9% YTD
• S&P 500: -0.4% YTD
• Nasdaq Composite: -3.1% YTD