Update: US Equity Indexes Drop as Treasury Yields, Crude Oil Jump Amid Fresh Military Strikes on Iran

01:26 PM EDT, 09/01/2026 (MT Newswires) -- (Updates with index/price moves, macroeconomic data, and geopolitical news from the first paragraph.) US equity indexes fell amid rising crude oil prices and a surge in the benchmark government bond yield to the highest in about 18 months as Washington struck Iranian targets on Tuesday. The Nasdaq Composite fell 0.9% to 26,122.9, the S&P 500 retreated 0.7% to 7,633.1, and the Dow Jones Industrial Average slid 0.8% to 52,747.8 after midday. Consumer discretionary, industrials, materials and technology led decliners, while energy topped gainers. US forces began striking Islamic Revolutionary Guard Corps targets in Iran, the US Central Command said in a message on X, formerly Twitter. The strikes follow recent attempted attacks by the IRGC against commercial shipping in the Strait of Hormuz and against American service members deployed to the region. US Secretary of the Treasury Scott Bessent said the Iran blockade is "very powerful" and "we are going to economically asphyxiate this regime," Al Jazeera, a Middle Eastern broadcaster, reported. The US will announce new sanctions on "anyone that does business with the IRGC" while the US is "tracking down the IRGC's assets," Bessent was cited as saying. In a video message shared by Iranian news agencies, Iran's Parliament Speaker Mohammad Bagher Ghalibaf said the US's naval blockade against Iran amounts to a military act and that Tehran will respond militarily if it intensifies, according to Al Jazeera. If the US's "will is that we do not export oil" from the Gulf, Ghalibaf said, "no one will be able to export oil." Two oil supertankers attempting to exit the Strait of Hormuz were struck by projectiles late Monday, Bloomberg reported, citing maritime security consultant Marisks. The front-month US West Texas Intermediate crude oil contract advanced 4.3% to $89.52 per barrel, and global benchmark North Sea Brent climbed 3.9% to $94.04 per barrel. Most US Treasury yields rose. The 10-year yield rose three basis points to 4.79%, the highest level since January 2025, and the two-year advanced 3.5 basis points to 4.39%. Gold futures dropped 1.9% to $4,397.30, and silver futures slumped 2.4% to $65.38. In economic news, US job openings rose to 7.271 million in July, according to the Bureau of Labor Statistics, below the 7.313 million openings expected in a survey compiled by Bloomberg, but up from the 7.182 million openings reported in June. The July level represents 4.4% of total employment, up from 4.3% in June and 4.3% a year earlier. The Institute for Supply Management's US manufacturing index fell to 54.6 in August from 55.6 in July, compared with expectations for 55.2 in a survey compiled by Bloomberg. The index indicates expansion, in line with most regional manufacturing sector readings and the S&P Global index, but contrasts with the Chicago PMI reading that suggested contraction. The first look at consumer confidence for September improved from August, with the RealClearMarkets' monthly index rising to 45.6 from 45.1. The index reading was the highest since March. The probability of the Federal Reserve raising its target rate by 25 basis points to 3.75%-4.0% in September surged to 66% after midday Tuesday from 40% a day ago, according to the CME FedWatch tool. The likelihood of another increase of the same magnitude in October is almost a fifth, putting into perspective a 10% chance of the rates remaining at the current level by December.