Wall Street opens lower as wholesale prices drop, oil slumps amid US-Iran deal hopes

Wall Street slipped Thursday morning as markets digested a surprise drop in US wholesale prices and oil tumbled on growing optimism over a potential nuclear agreement between the United States and Iran.The Dow Jones Industrial Average fell 170.92 points, or 0.41%, to 41,880.14 at the initial minutes of market opening. The Nasdaq Composite dropped 83.94 points (-0.44%) to 19,062.87, while the S&P 500 slid 15.44 points (-0.26%) to 5,877.14.The downward momentum followed new data from the US Lavor Department showing that wholesale prices fell 0.5% in April, marking the first monthly decline since October 2023 and the sharpest drop in five years. The producer price index (PPI) rose 2.4% year-over-year, decelerating from a 3.4% increase in March, defying expectations of a modest monthly gain.Core wholesale prices — which exclude food and energy — dropped 0.4% from March and were up 3.1% over the past year. The surprise deflationary reading was driven largely by a 0.7% drop in service prices, the biggest since government tracking began in 2009, amid thinning profit margins at retailers and wholesalers.Despite President Donald Trump’s sweeping tariffs, many economists believe the full inflationary impact will only show in the coming months. However, Trump’s recent move to ease tensions with China by cutting tariffs from 145% to 30% and securing reciprocal tariff reductions from Beijing has added fresh complexity to the inflation outlook.Earlier, Futures for the S&P 500 and Dow Jones Industrial Average each fell 0.4%. Nasdaq futures dipped 0.6%. Energy markets also saw significant movement. US benchmark crude dropped $2.37 to $60.78 per barrel, while Brent crude lost $2.32 to $63.70 per barrel. The decline came after President Trump, currently visiting Qatar, signalled progress toward a nuclear agreement with Iran, which could ease sanctions and lead to increased oil exports from the Islamic Republic.“The possibility of lifted sanctions has traders bracing for higher global supply,” said Russ Mould, investment director at AJ Bell.The fall in oil weighed on energy stocks, including BP and Shell, even as broader equity markets showed mixed reactions globally.In corporate news, Walmart shares rose 2.2% in early trading after the retail giant reported solid US sales growth despite a 12.1% decline in quarterly profit. The company noted that it has raised prices to offset higher costs linked to tariffs and opted not to issue second-quarter earnings guidance, citing the unpredictability of trade policy.Meanwhile, Foot Locker shares surged more than 80% to $23.57 after Dick’s Sporting Goods announced it would acquire the struggling footwear chain for $2.4 billion, its second major acquisition in as many weeks. Dick’s shares fell 8.5%.In global markets, Japan’s Nikkei 225 lost 1%, while Hong Kong’s Hang Seng declined 0.8%. Mainland China’s Shanghai Composite shed 0.7%, and South Korea’s Kospi fell 0.7%. India’s Sensex was a notable outlier, climbing 1.6%.In Europe, sentiment was mixed. Germany’s DAX edged down 0.1%, France’s CAC 40 lost 0.2%, while the UK’s FTSE 100 gained 0.3% on the back of better-than-expected UK GDP growth.