US stocks today: Dow falls 500 points after Trump says Iran deal is 'over'

The market absorbed a significant geopolitical shock as Donald Trump declared the Iran nuclear deal terminated, triggering a broad equity sell-off with the Dow declining 500 points. This escalation risk represents a classical risk-off catalyst, pulling sentiment toward defensive positioning despite some offsetting tailwinds in select equities.

Energy markets rallied sharply on supply disruption concerns, creating a sectoral divergence: while crude strength typically supports cyclical sectors, equity investors penalized financials and broad-market exposure. Technology displayed resilience, with semiconductor names AVGO and AAPL gaining on supply-chain optimization narratives tied to the Broadcom deal, suggesting selective rotation into perceived structural winners rather than macro capitulation.

The IMF's growth revisions compounds the negative backdrop, signaling economists expect slower global demand. This confluence—geopolitical tension, tighter monetary conditions embedded in inflation concerns, and reduced growth expectations—creates a stagflation-lite environment where traditional correlations break down: energy and defensives outperform, growth stocks lose conviction despite earnings resilience.

Sector implication: Energy and Utilities should outperform on safe-haven flows and inflation hedges, while Financials face headwinds from lower rate expectations and credit risk premiums. Technology's mixed performance reflects valuation pressure offset by AI/chip supply narratives, not fundamental strength.