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Indexes end lower as Iran launches rockets at Israel; defense shares rise

U.S. stocks ended lower, with the Nasdaq losing more than 1%, on Tuesday as financiers grew more careful after Iran fired missiles at Israel.

Iran introduced the salvo of ballistic rockets in retaliation for Israel's campaign against Tehran's Hezbollah allies. In action, U.S. President Joe Biden directed the U.S. military to help Israel's defense and shoot down rockets targeted at Israel, the White Home National Security Council said.

While the wider market fell, shares of energy companies increased together with U.S. oil rates, which settled up 2.4%.

Defense stocks also rose, including Northrop Grumman and Lockheed Martin. The S&P 500 aerospace and defense index reached a record high. Utilities were also up.

Airline shares fell, consisting of Delta Air Lines.

Investors played it safe following the Middle East news, but indexes ended off their lows of the day.

I hope we do not see further escalation, however if we do see even more escalation I might see ongoing market weak point because we just don't know how far this is going to go, stated Peter Tuz, president of Chase Financial investment Counsel in Charlottesville, Virginia.

The level of threat has actually increased. The markets have had a. excellent year and individuals can get scared out of the market depending. on what takes place over the next couple of weeks.

On Monday, the 3 major U.S. indexes scored strong. gains for September and for the quarter.

According to preliminary data, the S&P 500. lost 54.01 points, or 0.94%, to end at 5,708.47 points,. while the Nasdaq Composite lost 279.35 points, or 1.54%,. to 17,909.82. The Dow Jones Industrial Average. fell 171.76 points, or 0.41%, to 42,158.39.

CBOE's market volatility index, Wall Street's worry gauge,. increased.

Information launched early on Tuesday showed U.S. job openings. rebounded in August, while the Institute for Management Supply's. ( ISM) report showed production activity stood at 47.2 in. September, versus estimates of 47.5.

Investors were likewise mindful ahead of U.S. out of work claims. data on Thursday and monthly payrolls on Friday.

Traders are pricing in a 62.2% possibility that the. Federal Reserve will lower rates by 25 bps at its November. conference, the CME Group's FedWatch Tool revealed. Bets on a bigger. 50 bps cut stand at 37.8%.

Financiers also were keeping an eye on a port strike on the. East Coast and the Gulf Coast, halting the circulation of about half. the country's ocean shipping.

The strike that started on Tuesday is not expected to. cause global supply issues as deep or serious as during the. COVID-19 pandemic, but it still develops more financial. unpredictability for Fed policymakers to evaluate.

(source: Reuters)