Dow Dips Over 250 Points Amid US-Iran Tensions: Investor Sentiment Declines, Greed Index Remains In 'Fear' Zone

The CNN Money Fear and Greed index showed an increase in the overall fear level, while the index remained in the “Fear” zone on Thursday.

U.S. stocks settled lower on Thursday, with the Dow Jones index falling more than 250 points during the session after President Donald Trump stopped short of ruling out a potential military intervention in Iran.

In earnings, Deere & Co. (NYSE:DE) jumped 11.6% following upbeat quarterly earnings. Walmart Inc. (NASDAQ:WMT) fell 1.4% after broadly matching the Street's estimates. Booking Holdings Inc. (NASDAQ:BKNG) fell 6.2% following fourth-quarter results.

On the economic data front, the U.S. trade deficit increased to $70.3 billion in December from $53 billion in the previous month, compared to market estimates of a $55.5 billion gap. U.S. wholesale inventories increased by 0.2% month-over-month to $917.2 billion in December, matching November's level. U.S. initial jobless claims declined by 23,000 to 206,000 during the second week of February, compared to market estimates of 225,000.

Most sectors on the S&P 500 closed on a negative note, with consumer discretionary, financial and information technology stocks recording the biggest losses on Thursday. However, industrials and utilities stocks bucked the overall market trend, closing the session higher.

The Dow Jones closed lower by around 268 points to 49,395.16 on Thursday. The S&P 500 fell 0.28% to 6,861.89, while the Nasdaq Composite fell 0.31% at 22,682.73 during Thursday's session.

Investors are awaiting earnings results from Western Union Co. (NYSE:WU), PPL Corp. (NYSE:PPL) and DNOW Inc. (NYSE:DNOW) today.

What Is CNN Business Fear & Greed Index?

At a current reading of 38.5, the index remained in the “Fear” zone on Thursday, versus a prior reading of 39.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.

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