Small-cap stocks are plunging. Are stalled Iran negotiations responsible?

Small-cap stocks are experiencing significant declines, particularly the Russell 2000, which fell 1.6% amid stalled U.S.-Iran negotiations. The uncertainty has led to rising oil prices and interest rates, signaling potential inflation. Despite a recent 3% gain due to hopes for a resolution, earnings reports from major holdings like Bloom Energy and Shake Shack have negatively impacted the index. However, analysts suggest that small-cap stocks may present an opportunity for investors due to lower valuations compared to large-cap stocks, especially if macroeconomic conditions improve.