Wall Street drops from its records and oil prices jump after fighting flares in the Middle East

The action was stronger in the oil market, where the price for a barrel of Brent crude leaped 5.8% to settle at $114.44. It jolted higher after the United Arab Emirates, a U.S. ally, said it came under attack by Iran for the first time since the ceasefire took hold in early April. The attacks appeared to be in response to U.S. President Donald Trump’s latest efforts to reopen the Strait of Hormuz.

Iran’s closure of the strait has kept oil tankers pent up in the Persian Gulf and away from customers worldwide. That in turn has sent the price of Brent soaring from roughly $70 per barrel before the war.

Trump said Sunday that the United States would guide ships through the strait, which could get oil flowing again and bring down its price. But prices instead climbed with uncertainty about what would happen next.

The U.S. military said Monday that two American-flagged merchant ships had successfully transited the Strait of Hormuz. It also said that it sank six small boats as it set up an “enhanced security area” for ships crossing the strait.

Even with all the uncertainty about how long the war with Iran will last, the U.S. stock market has managed to power to record after record. Hope is still high on Wall Street that the global economy can avoid a worst-case scenario because of the war. And in the meantime, companies continue to deliver big growth in profits. That's key because stock prices tend to follow the path of corporate profits over the long term.

The strength so far this reporting season has been broad-based and not confined to just the Big Tech superstars that dominate the market. The median stock in the S&P 500 is tracking for the best growth since 2021, according to Savita Subramanian, a strategist at Bank of America.

Tyson Foods joined the list Monday of those topping analysts’ expectations for both profit and revenue during the latest quarter.

It sold less beef than it did a year ago, but it did so at prices that were 11.5% higher, so its total beef revenue edged up. It also sold more chicken and pork than a year earlier, at slightly higher prices. Its stock rose 4.2% and helped limit Wall Street's losses.

Norwegian Cruise Line Holdings likewise delivered a better profit for the latest quarter than analysts expected. But it’s feeling the effects of the war, which has not only raised pressure on fuel prices but also pushed customers to think twice about travel plans, particularly to Europe.

The cruise operator said some “execution missteps” also have bookings below where it would like, and its stock fell 9.6%.

UPS and FedEx dropped roughly as much for some of the market's sharpest losses after Amazon announced a move that could cut into their businesses. The online giant said it's begun allowing Procter & Gamble, 3M and other big companies to use its logistics services to move inventory, fulfill orders and deliver packages directly to shoppers.

UPS dropped 9.7%, and FedEx fell 9.3%, while Amazon rose 0.9%.

GameStop slumped after it said it wants to buy eBay, a much larger company, for $125 per share in cash and stock. Coming into the day, eBay had a total market value that was nearly quadruple GameStop’s.

GameStop said it has already built a 5% stake in eBay and sees opportunities to cut $2 billion in annual costs quickly. GameStop, whose stock briefly soared to market-shaking heights during the meme stock craze of 2021, fell 9.4%, while eBay rose 4.8%.

In stock markets abroad, gains for tech stocks helped indexes jump 5.1% in South Korea and 1.2% in Hong Kong, while markets were closed in mainland China and Japan for holidays.

European indexes fared worse, and France’s CAC 40 fell 1.7%.

In the bond market, Treasury yield jumped with the price of oil. The yield on the 10-year Treasury rose to 4.44% from 4.39% late Friday. It was at just 3.97% before the war began, and the rise has made mortgages and other kinds of loans for U.S. households and businesses more expensive.

AP Business Writers Matt Ott, Anne D’Innocenzio and Elaine Kurtenbach contributed.