The Dow Jones plunges 1,200 points late at night, gold drops below $5,000, silver crashes 10%, and international oil prices surge 8%.

On March 3, Beijing time, U.S. stock markets fell sharply, with all three major indices dropping over 2%, and the Dow Jones Industrial Average down more than 1200 points.

Large tech stocks collectively declined, with Google, NVIDIA, and Tesla all falling over 2%.

The semiconductor sector also dropped collectively, with the Philadelphia Semiconductor Index down over 4%, Intel falling 5.8%, and TSMC and ASML down more than 5%.

Chinese concept stocks fell across the board, with the Nasdaq Golden Dragon China Index dropping over 5%, Kingsoft Cloud down 12.44%, Wanzhong Xinshi down 10.02%, Xpeng Motors down 8.95%, and Baidu Group and Alibaba both down over 6%.

Spot gold and silver continued to decline, with spot gold briefly falling below $5000, down over 6% for the day; spot silver was reported at $79.63 per ounce, with a drop of over 10%.

International oil prices continued to rise, with WTI and Brent crude both surging 8%, Brent crude priced at $84.27 per barrel, reaching a new high since July 2024.

Most cryptocurrencies fell, with Bitcoin down 0.92%, priced at $66,334 each.

According to Xinhua News Agency, international observers believe that the duration of the conflict between the U.S. and Israel is exceeding market expectations, potentially triggering “the largest oil crisis in years,” which not only severely disrupts global energy supply and raises inflation but also impacts the monetary policy direction of major economies, potentially leading to a global economic recession under extreme circumstances such as a prolonged closure of the Strait of Hormuz.

Regarding the future of U.S. stocks, the surge in oil prices has raised concerns about “re-inflation,” directly dampening market expectations for a rate cut by the Federal Reserve this year.

Traders are preparing for a Federal Reserve that will maintain higher interest rates for a longer period. The futures market has pushed back expectations for the next rate cut by the Federal Reserve to September, with only two 25 basis point cuts anticipated this year, and a third cut possibly not occurring until 2027.

The Federal Reserve’s dual mandate of “job stability” and “anti-inflation” is coming into conflict. Wu Qidi, director of the Securities Research Institute at Source Da Information, told reporters from the 21st Century Business Herald that in the short term, the priority for anti-inflation may be passively elevated, causing the Federal Reserve to delay rate cuts. The Federal Reserve may consider geopolitical uncertainties and choose a “higher for longer” interest rate policy to observe the developments.