Major U.S. stock indices closed lower for the second consecutive session.

While the Nasdaq composite tumbled more than 2%, the S&P 500 fell over 1%, and the Dow Jones Industrial Average also failed to escape the downturn.

Consumer discretionary and communication services sectors plunged more than 4%, leading the market decline.

The sharp downward pressure on the market today stemmed from soaring international oil prices driven by escalating Middle East tensions and growing concerns over Big Tech earnings.

Geopolitical anxieties reached a fever pitch as Yemen's Houthi rebels attacked a Saudi oil tanker and the U.S. military launched successive airstrikes against Iran.

Consequently, Brent crude breached 100 dollars a barrel, and West Texas Intermediate (WTI) surged toward the 92 dollar mark.

As the oil price spike heightened fears of a resurgence in inflation, the yield on the 10-year U.S. Treasury note surpassed 4.7%.

Key tech stocks that released their earnings suffered severe blows as well. Alphabet sharply raised its capital expenditure outlook for this year to a maximum of 205 billion dollars to meet AI demand, but growing doubts over profitability relative to such massive investments sent its shares plummeting by over 7%.

Tesla also recorded an earnings shock as operating expenses outpaced revenue, triggering a plunge of around 14%.

Both companies saw their free cash flow turn negative, intensifying concerns over financial burdens.

However, news of Big Tech's aggressive expansion in AI facility investments raised expectations of benefits for memory semiconductor-related stocks, driving gains in that sector.

Tomorrow, the preliminary U.S. manufacturing and services Purchasing Managers' Index (PMI) for July is scheduled to be released, while the market is also keeping a close eye on the earnings reports of Meta and Microsoft due next week.