New York, Oct 18 : US stock markets were shaken as stocks opened lower on Wednesday as the hospital blast in Gaza upped the Middle East tensions with oil prices jumping. Investors virtually dug into a hole with Morgan Stanley returning lacklustre earnings. The Dow Jones Industrial Average fell more than 0.2 percent while the benchmark S&P 500 dropped nearly 0.5 per cent and the tech-heavy Nasdaq Composite slipped 0.3 per cent. Markets went into a cautionary mode as Israeli and Palestinian authorities exchanged blame for the hospital blast in Gaza. While Hamas blamed the Israeli air strikes, Israel blamed the Hamas for firing a misguided missile that hit the hospital. The US also supported the Israeli claim through its intelligence sources, US media reports said. US President Joe Biden made this claim soon after landing in Israel on Wednesday, even as Jordan cancelled a planned summit with Arab leaders after the Gaza hospital blast. Biden's comment that the "other team" was responsible thinned chances of a diplomatic breakthrough highlightingthe risk of a greater theater of war in the Middle East region. Oil prices jumped more than 1 per cent, as gains stacked up after Iran's foreign minister slapped an embargo against Israel. Crude oil futures climbed to $88 a barrel, while Brent crude traded at $91 a barrel at the last count. Rising fuel prices give investors a nervous jerk as they have to weigh in another inflation factor for future decisions fearing the Federal Reserve could move in swiftly with another interest rate hike. The major US stock indices closed mostly flat on Tuesday after strong retail sales spurred expectations that the Fed will hike interest rates again this year. Among techs, shares of ASML (ASML, ASML.AS) fell after the Dutch chip equipment maker warned about flat sales ahead, as customers went slow on their orders fearing an uncertain economic scenario. Meanwhile, Nvidia (NVDA) stock retreated alongside other semiconductor makers after the US tightened curbs on AI chip technology exports to China, though there could be some silver lining in the rules. Stocks were lower at the market open on Wednesday as rising Middle East tensions sent oil prices higher and investors digested lackluster earnings from Morgan Stanley. /IANS