Private credit fears and U.S.-Iran tensions pressure Wall Street

U.S. markets had a shaky Thursday, pressured by Washington’s escalating tensions with Iran and renewed worries over private credit.

White House press secretary Karoline Leavitt said Wednesday that there were “many reasons and arguments that one could make for a strike against Iran,” and President Donald Trump said Thursday he will decide within 10 days whether to take action.

Concerns over oil supply in the event of military action in Iran pushed oil prices up almost 2%.

Meanwhile, Blue Owl Capital tightened investor liquidity after selling $1.4 billion in loan assets, raising alarms about the stability in the private credit market. Its stock fell nearly 6%, while shares of other asset managers, such as Blackstone and Apollo Global Management, retreated as well.

Software stocks also ended the day in the red, with Salesforce, Intuit and Cadence Design Systems dropping.

The combined set of worries led markets lower. The S&P 500 lost 0.28%, putting it near the flat line for the year. The Dow Jones Industrial Average fell 0.54% and the Nasdaq Composite closed 0.31% down.

But there’s some positive sentiment at India’s AI Impact Summit. CNBC talked to Microsoft President Brad Smith, OpenAI CEO Sam Altman and Qualcomm head Cristiano Amon about their views on the artificial intelligence industry, semiconductor manufacturing, competition with China, among other topics.

In early Asian news, Japan reported that its headline inflation rate plunged to 1.5% in January, the lowest level since March 2022 and below the Bank of Japan’s 2% target for the first time in 46 months. Investors should also keep an eye out for China’s loan prime rate decision, coming out later in the day.

— CNBC’s Lim Hui Jie, Spencer Kimball and Hugh Leask contributed to this report.

Blue Owl sold $1.4 billion of loan assets held in three of its private debt funds, the private market and alternative assets manager said Wednesday. Blue Owl said that following the deal, one fund would end regular quarterly liquidity payments to investors.

Walmart’s fiscal fourth-quarter results beat earnings and revenue estimates as gains in e-commerce, advertising and its third-party marketplace boosted its business. But Walmart’s forecast of earnings for the current full fiscal year fell short of expectations.

The U.S. trade deficit totaled $901 billion in 2025, closing out a year in which the imbalance was essentially unchanged despite efforts by the Trump administration to close the wide gap.

Major U.S. indexes fell Thursday as investors shifted away from financials and software stocks. The pan-European Stoxx 600 dropped 0.53% as investors weighed earnings from Airbus, Renault, and Nestle, among others.

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