GLOBAL MARKETS: US stocks end lower, oil gains as Iran rejects peace talks

Wall Street stocks followed their global counterparts to a lower close on Tuesday and crude prices extended their gains amid concerns over the latest developments involving the Iran war.

All three major U.S. stock indexes extended their losses toward the end of the session after Iran rejected a second round of negotiations, saying it would participate only if the United States abandons its policy of pressure and threats.

After the closing bell, U.S. President Donald Trump said he would extend a ceasefire in the war until an Iranian proposal is submitted.

Iran's move follows the seizure of the Iranian-flagged ​container ship Touska by U.S. forces to enforce Trump's blockade.

"What's happening in the Middle East is the primary market driver of the very short term, and that very short term can be minute-to-minute," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "I'm not surprised by the way the market is kind of behaving with that deadline looming near."

WARSH FACES THE SENATE

Kevin Warsh, Trump's pick to succeed Jerome Powell as Federal Reserve chair, called for a "regime change" at the central bank in comments before the Senate Banking Committee. Warsh called for a new approach to controlling inflation and a communications overhaul that could discourage his colleagues from saying too much about the direction of monetary policy.

A Commerce Department report showed U.S. retail sales were more robust than analysts expected in March, but much of the upside surprise was driven by a 15.5% surge in gasoline station receipts due to price spikes related to the Iran war.

The Dow Jones Industrial Average .DJI fell 292.96 points, or 0.59%, to 49,149.60, the S&P 500 .SPX fell 45.12 points, or 0.63%, to 7,064.02 and the Nasdaq Composite .IXIC fell 144.43 points, or 0.59%, to 24,259.96.

EUROPEAN, GLOBAL STOCKS DIP

European shares ended lower as risk appetite soured on Iran war concerns.

MSCI's gauge of stocks across the globe .MIWD00000PUS fell 6.51 points, or 0.61%, to 1,065.48.

The pan-European STOXX 600 .STOXX index fell 0.87%, while Europe's broad FTSEurofirst 300 index .FTEU3 fell 22.64 points, or 0.91%.

Emerging market stocks .MSCIEF rose 10.37 points, or 0.65%, to 1,610.75. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed higher by 0.77%, to 824.64, while Japan's Nikkei .N225 rose 524.28 points, or 0.89%, to 59,349.17.

The U.S. dollar advanced while the retail sales report signaled economic strength.

The dollar index =USD, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.48% to 98.54, with the euro EUR= down 0.54% at $1.1723.

Against the Japanese yen JPY=, the dollar strengthened 0.51% to 159.6.

In cryptocurrencies, bitcoin BTC= fell 1.55% to $75,130.32. Ethereum ETH= declined 1.65% to $2,299.82.

Oil prices reversed an earlier dip after Trump earlier said he did not want to extend the ceasefire.

U.S. crude CLc1 rose 2.81% to settle at $92.13 per barrel, while Brent LCOc1 settled at $98.48 per barrel, up 3.14% on the day.

U.S. Treasury yields rose after retail sales data reinforced expectations that the Fed will keep rates steady this year.

The yield on benchmark U.S. 10-year notes US10YT=RR rose 6.3 basis points to 4.313%, from 4.25% late on Monday.

The 30-year bond US30YT=RR yield rose 3.4 basis points to 4.9152% from 4.881% late on Monday.

The 2-year note US2YT=RR yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 8.6 basis points to 3.802%, from 3.716% late on Monday.

Gold prices dropped as the dollar firmed. Spot gold XAU= fell 2.95% to $4,677.54 an ounce. U.S. gold futures GCc1 fell 2.71% to $4,676.40 an ounce.

-Stephen Culp/Reuters