[New York Stock Exchange] Tensions Rise Ahead of Second Talks... All Major Indices Open Lower

New York Stock Exchange. New York (USA) - Special Correspondent Yoonjoo Hwang

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On April 20 (local time), ahead of the second ceasefire talks between the United States and Iran, all three major U.S. stock indices opened lower. Following the previous day's incident in which U.S. forces seized an Iranian vessel in Iranian waters, heightened tensions have led to increased concerns in the market about the potential breakdown of negotiations.

According to the home trading system (HTS), as of 9:35 a.m. at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average was down 45.57 points, or 0.09%, at 49,401.86. The S&P 500 index, which focuses on large-cap stocks, fell 10.10 points, or 0.14%, to 7,115.96, while the tech-heavy Nasdaq index declined 44.80 points, or 0.18%, to 24,423.68.

The previous day, the U.S. Central Command announced that it had seized the vessel Tuska, which had departed from China and was heading for Bandar Abbas, Iran, causing the atmosphere to worsen again. The U.S. military stated that it had warned the vessel to stop, but after being ignored for six hours, ordered the evacuation of the engine room and then disabled the propulsion system by firing multiple rounds from a 5-inch (127mm) MK45 naval gun.

The Iranian military authorities stated that they would retaliate, but also made it clear that any response would only occur after ensuring the safety of those on board. This has created a precarious situation even before the start of the second round of talks. Esmail Baghaei, spokesperson for Iran's Foreign Ministry, emphasized at a regular press briefing on April 20 that, "As of this very moment, there are no plans or decisions made regarding participation in the next round of negotiations."

However, it appears the Iranian delegation will participate in the second round of talks for now. According to local media such as Pakistan Observer, it was reported that the Iranian delegation is scheduled to visit Islamabad on April 21.

Adam Crisafulli of Vital Knowledge stated, "Although the overall news flow from the Middle East over the weekend was negative, the overall process still seems to be on a path toward easing tensions, just as it was last weekend."

Defense and energy stocks are rising across the board. Notable gains include Lockheed Martin at +0.63%, AeroVironment at +0.17%, RTX at +0.76%, Northrop Grumman at +0.79%, Occidental Petroleum at +1.54%, Diamondback Energy at +1.84%, and APA at +1.22%.

International oil prices are climbing in response to the changing situation. At this hour, West Texas Intermediate (WTI) crude oil futures on the New York Mercantile Exchange are trading at 86.15, up 4.27% from the previous session. Brent crude oil futures on the ICE Futures Exchange are up 3.50% at 93.54 dollars compared to the previous session.

Refining stocks such as ExxonMobil (+1.13%) and Chevron (+0.87%) are also on the rise. In contrast, major tech stocks with large market capitalizations are declining. Nvidia is down 0.82%, Apple down 0.24%, Microsoft down 0.28%, Amazon down 0.58%, TSMC down 0.43%, and Meta down 0.66%.

Peter Boockvar, Chief Investment Officer at OnePoint BFG Wealth Partners, told CNBC, "The situation with Iran is becoming more complicated, and it is now uncertain when the conflict will end and when the straits will be fully reopened without fear of attacks."

He added, "Assuming there is no new news, the only key issue for the markets on Monday will be the extent of the decline."

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