Oil Prices Leap More Than 6%

Oil prices leaped Monday on worries that war with Iran could clog the global flow of crude and make inflation even worse. US stocks, meanwhile, swung from sharp losses to a tiny gain.

• The S&P 500 rose 2.74 points, or less than 0.1%, to 6,881.62.
• The Dow Jones Industrial Average fell 73.14 points, or 0.1%, to 48,904.78.
• The Nasdaq composite rose 80.65 points, or 0.4%, to 22,748.86.

The S&P 500 fell as much as 1.2% at the start of trading, and cruise lines and airlines led the way lower, the AP reports. But US stocks quickly erased those losses, in part because past military conflicts haven't usually created sustained drops for the market. The Dow and the Nasdaq also came back from steep early losses.

Crude prices jumped more than 6%, which will likely mean higher prices soon at gasoline pumps. That would hurt not only US households, whose spending makes up the bulk of the US economy, but also businesses with big fuel bills. Prices for natural gas remained higher, meanwhile, which could raise heating bills for the remainder of the winter, after a major supplier of liquefied natural gas to Europe said it would stop production because of the war. Gold climbed 1.2% as investors looked for safer things to own. Typically, Treasury yields also fall in the bond market when investors are feeling nervous. But yields instead climbed, in part because higher oil prices will put upward pressure on inflation.

Stocks of airlines were some of Monday's sharpest losers. Not only do higher oil prices threaten their already big fuel bills, the fighting in the Middle East also closed airports and left travelers stranded. American Airlines lost 4.2%, United Airlines fell 2.9%, and Delta Air Lines sank 2.2%. Norwegian Cruise Line Holdings dropped even more, 10.6%. It needs customers to have plenty of cash to spend after paying for gasoline and other essentials. Stocks in the housing industry struggled as higher Treasury yields could translate into more expensive mortgage rates. Homebuilder DR Horton lost 3.7%, and Builder FirstSource sank 4.7%.

Helping the US stock market bounce back from its early losses were oil companies, which benefited from the rising price of crude. Exxon Mobil climbed 1.1%, and Marathon Petroleum rose 5.9%. Companies that make equipment for the military also strengthened. Northrop Grumman climbed 5.9%, and RTX rallied 4.7%. Palantir Technologies, whose software helps global defense agencies and other customers, jumped 5.8% for one of the biggest gains in the S&P 500. Big Tech stocks also helped support the market. Nvidia rose 2.9% and was the strongest single force pushing the S&P 500 higher.