Wall Street wrapped up the week on a sour note as renewed tensions between Israel and Iran rattled global markets on Friday.
After Israel launched strikes on Iranian military and nuclear sites—and Iran quickly fired back—investors grew nervous about a wider conflict in the Middle East.
That fear sent major U.S. indexes tumbling: the S&P 500 dropped 1.1 percent, the Dowfell 1.8 percent, and the Nasdaq slipped 1.3 percent, with energy stocks among the few bright spots.
Oil prices surged in response. West Texas Intermediate crude jumped 7.5 percent to USD 73.12 a barrel, after spiking as much as 14 percent overnight—its biggest single-day move in years. Brent crude, the global benchmark, was also up more than 7 percent, trading at USD74.38.
Analysts are concerned oil could soar past USD100 per barrel if Middle East tension escalates, as had happened when Russia invaded Ukraine in 2022.
The market jitters weren’t limited to the U.S.
Asian markets fell across the board: Japan’s Nikkei 225 dropped 2.2 percent, Hong Kong’s Hang Seng lost 1.7 percent, and South Korea’s KOSPI was down 1.5 percent. Over in Europe, the FTSE 100 slid 1.4 percent, Germany’s DAX lost 1.9 percent, and France’s CAC 40 fell 1.8 percent.
With oil prices climbing, all eyes now turn to the Federal Reserve, which meets next week. While the Fed is expected to hold rates steady, rising energy costs could make its fight against inflation even more complicated.
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