Oil prices slide on signs of easing U.S.-Iran tensions

Oil prices slipped further on Monday as the United States and Iran held off from escalating their intermittent conflict, with mediators reporting progress toward restarting stalled negotiations. Brent crude, the global oil benchmark, dropped $1.35 to $84.52 per barrel, extending a recent decline that began when the Iran war started in late February, when prices were around $72 per barrel. U.S. benchmark crude oil fell 81 cents to $81.80 per barrel. Regional officials said on July 27 that mediators had made progress in restarting talks between Washington and Tehran after both sides paused attacks. The Strait of Hormuz, a critical chokepoint for global oil shipments, remained calm, with commercial vessels anchored near Bandar Abbas, Iran, as reported by local media. On Wall Street, futures for the Dow Jones Industrial Average rose 0.7%, while the S&P 500 futures were flat. The tech-heavy Nasdaq futures slid 1%, dragged lower by chipmakers after South Korea’s Kospi index plummeted nearly 11% in a brutal sell-off. Samsung Electronics and SK Hynix shares plunged 13.4% and 14.7%, respectively, as the Kospi closed 10.8% lower at 6,023.66, its lowest level since April. The rout in chip stocks followed a report that China has begun mass production of homegrown deep ultraviolet (DUV) chipmaking tools, raising concerns about intensified competition for global leaders. Chinese memory chipmaker CXMT’s trading debut in Shanghai saw its shares jump 466% before dropping 4% the next day after raising at least $8.6 billion in its IPO. Analysts at Morningstar suggested the sell-off was an overreaction, noting that global chipmaking leaders’ dominance is unlikely to be meaningfully threatened. Meanwhile, U.S. stocks showed mixed reactions to corporate news: Johnson & Johnson shares rose 3% after agreeing to a $5.5 billion settlement to resolve remaining ovarian cancer lawsuits linked to its talc products, contingent on at least 95% of claimants participating. Coca-Cola Co. surged 4.5% after beating Wall Street’s sales and profit targets, while UPS Inc. reported strong quarterly earnings but saw only a modest 1% share increase. Across Asia, Tokyo’s Nikkei 225 fell 4% to 62,364.92, the Taiex in Taiwan dropped 4.7% with TSMC down 3%, and Hong Kong’s Hang Seng edged up 0.4%. Australia’s S&P/ASX 200 gained 0.6%, India’s Sensex slipped 0.1%, and European markets showed minimal movement, with Germany’s DAX and France’s CAC 40 up less than 0.1%, and Britain’s FTSE 100 rising 0.5%.