Oil prices rise, and stocks drop worldwide after Trump says ceasefire with Iran is ‘over’

NEW YORK (AP) 鈥� Oil prices rose, and stock markets dropped in shaky trading worldwide Wednesday after in the .

The S&P 500 fell as much as 1.1% after was 鈥渙ver,鈥� but the index then trimmed its loss to 0.3% after Trump said recent fighting did not mean a return to full-scale war. They鈥檙e his latest mixed messages on what will happen with the war, which threatens to worsen inflation for the world.

The Dow Jones Industrial Average dropped 576 points, or 1.1%, while the Nasdaq composite rose 0.2% after erasing an early loss.

The action was stronger in the oil market, where the price for a barrel of Brent crude climbed 5.2% to $78.02 and briefly topped $80.

That鈥檚 still below its peak from earlier in the war, when the price for the most actively traded contract reached nearly $120. But the jump is unsettling because oil prices had just dropped back to where they were before the war.

is that a continuation of the war will block and prevent the delivery of crude from the Persian Gulf to customers worldwide. That could worsen , which economists expected would ease with oil prices, and in turn force and other central banks to

Higher rates can keep a lid on inflation, but they also slow the economy and hurt prices for all kinds of investments.

On Wall Street, stocks of companies in the housing industry helped lead the way lower. They were hurt by worries that rising Treasury yields in the bond market will mean and chill the industry.

Builders FirstSource, which sells countertops, windows and other building supplies, fell 5.4%. Homebuilders PulteGroup fell 5.4%, and D.R. Horton sank 4.6%.

Companies with also sank. American Airlines lost 4%, and cruise operator Carnival fell 3.9%.

Helping to offset those losses was a steadying for some influential stocks in the industry. They鈥檝e been under on worries that their prices shot too high and that AI may not produce enough productivity and profits to make all the investments in chips and data centers worth it.

Their swings carry a lot of weight on Wall Street because AI stocks have grown into some of the U.S. market鈥檚 biggest, giving their movements more effect on the S&P 500 than other stocks.

Nvidia rose 3.7%, for example, and was the strongest force pushing upward on the S&P 500 because it鈥檚 the largest stock on Wall Street.

Close behind was Broadcom, which climbed 4.8% after Apple announced a multiyear commitment where Broadcom will design and produce custom components for its products. Apple said the agreement鈥檚 value could top $30 billion.

All told, the S&P 500 fell 21.14 points to 7,482.71. The Dow Jones Industrial Average dropped 576.76 to 52,348.39, and the Nasdaq composite rose 51.96 to 25,870.65.

In the bond market, Treasury yields rose with the price of oil. The yield on the 10-year Treasury briefly got near 4.60% before pulling back to 4.57%. That鈥檚 up from 4.55% late Tuesday and from just 3.97% before the war with Iran began.

In stock markets abroad, European markets turned sharply lower after Trump said, 鈥淔or me, I think it鈥檚 over鈥� about the status of the ceasefire. He added that U.S. representatives can continue negotiations, 鈥渂ut I think they鈥檙e wasting their time.鈥� Germany鈥檚 DAX lost 2.2%, and France鈥檚 CAC 40 sank 2.2%.

In Asia, South Korea鈥檚 Kospi dropped 5.3% and continued its sharp swings amid seesawing worries and euphoria about the AI stocks that dominate its market.

Hong Kong鈥檚 Hang Seng index was an outlier and rose 3%. Shares that trade there of Chinese AI startup Zhipu, known also as Z.ai and traded as Knowledge Atlas Technology, jumped 13.4%.

A six-month lock-up period for 鈥渃ornerstone鈥� investors following its January trading debut in Hong Kong expires this week. China National Radio reported late Tuesday that nearly 70% of Zhipu鈥檚 cornerstone investors are committed to stay on, despite previous worries that the lock-up period expiration could trigger a sell-off.

Zhipu鈥檚 share price has risen more than 1,300% since its debut.

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AP Business Writers Matt Ott, Chan Ho-him and Elaine Kurtenbach contributed to this report.