Oil futures settled at a one-week high on Tuesday after the Israel Defense Forces said Iran launched a missile attack on Israel. The move is considered to be a

U.S. stocks retreated from their records Tuesday after Iran fired missiles into Israel, a sharp escalation of tensions in the Middle East that investors fear could lead to disruptions in the flow of oil.

Oil prices jumped about 4% on Tuesday after Iran fired a salvo of ballistic missiles at Israel in retaliation for Israel's campaign against Tehran's Hezbollah allies in Lebanon. Alarms sounded across Israel and explosions could be heard in Jerusalem and the Jordan River valley after Israelis piled into bomb shelters.

Stocks opened lower and stayed there through the close as investors worried about the potential disruption from a major port strike and increasing tensions in the Middle East. The latest round of economic data weighed on sentiment too.

Oil prices jumped about 4% on Tuesday following reports Iran was preparing to launch a missile attack on Israel. Brent futures were up $2.50, or 3.5%, to $74.20 a barrel by 11:50 a.m. EDT (1550 GMT),