The US stock market crashed significantly on Monday, July 13th, with the Nasdaq Composite and Nasdaq 100 indexes falling steeply by 400 points to 600 points due to sharp selling pressure in chip stocks.
Not just that, even the Dow Jones and S&P 500 indexes were down as crude oil prices soared to elevated levels, creating a higher probability of a rate hike in the September 2026 policy for the US Federal Reserve. On Tuesday, investors will focus on the CPI inflation data for July 2026.
Dow Jones & S&P 500 Indexes
The Dow Jones Industrial Average, or DJIA dropped by 138.37 points or 0.3% to close around 52,498.64. Stocks like Boeing, Caterpillar Inc, Honeywell International, Home Depot, Cisco, Nike, Alphabet and Goldman Sachs fall by 1% to 3%, dragging the index.
Meanwhile, the S&P 500 index dipped by 60.05 points or 0.8% to end at 7,515.34.
The major reason for the decline in the Dow Jones and S&P 500 is the sharp surge in crude oil prices, with US WTI crude reaching near $80 per barrel and Brent crude above $85 per barrel. This is highly elevated and raises the chances of a rate hike in September’s policy.
Investors assessed escalating tensions in the Middle East after President Donald Trump reinstated a blockade on Iranian vessels transiting the Strait of Hormuz. The move sent oil prices sharply higher and weighed on equities, fueling concerns that central banks may need to raise interest rates to contain renewed inflationary pressures, as per Trading Economics.
Nasdaq Composite, Nasdaq 100 Index
But the worst to take the hit were Nasdaq 100 and Nasdaq Composite.
The Nasdaq 100 index crashed the most by 561.01 points or 1.9% to close at 29,264.10. While the Nasdaq Composite index dropped by 408.43 points or 1.6% to finish at 25,873.18.
This is due to sharp selloffs in chip stocks. As per Trading Economics, chipmakers led the losses amid persistent concerns that AI hyperscalers could scale back spending on AI infrastructure, with Micron (-4.3%), Nvidia (-3.5%), Sandisk (-12.6%), AMD (-4.2%), and Intel (-6.1%) all ending lower.
US CPI Inflation Predictions On July 14
The US consumer price index (CPI) inflation data will be released on Tuesday, July 14, 2026. The CPI inflation is expected to cool mildly in June 2026. However, experts believe a one-month’s softer inflation is not enough to dampen the rate hike trajectory.
As per trading platform, IG UK, the ceasefire that caused June gasoline prices to fall ended on 8 July. Since then, fresh US airstrikes over the weekend and Iran’s disputed Strait of Hormuz closure claim have pushed oil prices back up. Whatever relief the June energy decline provides to the headline CPI number is a backwards-looking snapshot of a price level that no longer applies. July’s data – to be released in August – is likely to look materially different.
“Investors who react to a soft June headline as evidence that inflation is cooling and rate cuts are near may be making a significant error. The Federal Reserve will not be fooled by a one-month energy reversal driven by a ceasefire that has since collapsed,” it added.
Apart from the US CPI data, investors will also focus on the earnings report of big banks lik e JPMorgan JPM, Bank of America BAC, and Wells Fargo WFC on Tuesday.