US stocks moved lower on Wednesday as investors assessed quarterly reports from major banks and new economic figures, with attention also fixed on possible American military moves against Iran.
The Nasdaq Composite dropped about 1.4%, and the S&P 500 declined nearly 1%. The Dow Jones Industrial Average fell around 0.6%, continuing a pullback from record highs after financial stocks retreated on Tuesday.
Technology shares drove the day's losses as large-cap stocks declined. Nvidia shares fell even after the US formally approved its chip exports to China, amid reports of potential restrictions. Tesla and Broadcom shares also posted significant drops.
Concerns over US action toward Iran intensified as President Trump escalated military threats following a deadly crackdown on public protests. Oil prices rose to a two-month high after Iran warned of retaliation to any American strikes and the US withdrew some personnel from regional bases.
Bank of America and Wells Fargo released quarterly results, both reporting profit surges driven by trading activity. Their stocks fell, however, along with Citigroup's, extending early earnings-season weakness that began with a disappointing report from JPMorgan Chase.
Investors examined muted wholesale inflation data, following Tuesday's mild consumer inflation reading that reinforced expectations the Federal Reserve will hold interest rates steady in January. Meanwhile, retail sales for November, delayed by a government shutdown, rose more than anticipated.
Gold and silver reached fresh record highs, with silver briefly surpassing $90 for the first time, supported by prospects of further Fed rate cuts. Rising geopolitical tensions and escalated attacks on the Fed, both centered on President Trump, also fueled the precious metals rally.
Markets awaited word from the Supreme Court, which again declined to rule on a closely watched challenge to Trump's authority to set tariffs. Trump has called the case a national security flashpoint, stating on social media that if the court rules against him, "WE’RE SCREWED!"