U.S. stocks are falling in morning trading Wednesday, as escalating tensions with Iran and renewed weakness in semiconductor shares weighed on markets, CNBC reports.

The Dow Jones Industrial Average dropped more than 470 points, while the S&P 500 and Nasdaq Composite lost 0.7% and 1%, respectively.

President Donald Trump warned Iran had "taken too long" to negotiate a deal and said the country would "pay the price," following U.S. strikes on Iranian targets after Tehran allegedly downed a U.S. Army Apache helicopter near the Strait of Hormuz.

Oil prices climbed on the developments, with West Texas Intermediate crude rising more than 1% to around $89 a barrel.

Chip stocks also extended recent losses.

Shares of Micron Technology, AMD, and Broadcom fell again as investors continued to pull back from the sector following a sharp rally tied to artificial intelligence.

Some traders attributed the selling to investors raising cash ahead of Friday's highly anticipated SpaceX IPO.

Markets recovered somewhat after May core inflation came in slightly below expectations. Core consumer prices rose 0.2% for the month, compared with forecasts of 0.3%, while annual core inflation was 2.9%. However, headline inflation topped 4% for the first time in three years.

The sell-off follows a broader retreat in technology shares that began last week after months of strong gains fueled by AI enthusiasm.