Oil prices surged to $102.88 a barrel as uncertainty over the Iran conflict disrupts Persian Gulf energy flows, fueling global inflation fears. U.S. stocks swung wildly: the S&P 500 fell 0.3%, deepening losses from its worst week since the war began. The Dow edged up 0.3%, while the Nasdaq dropped 0.6%.
President Donald Trump claimed "great progress" in negotiations to end military operations in Iran-but also threatened to "obliterate" Iranian power plants if the Strait of Hormuz remains closed. Markets reacted with skepticism, as investors question the durability of his claims.
The S&P 500 is now 8.7% below its January peak, with the Dow and Nasdaq over 10% off records-meeting the technical definition of a correction. Strategists at Morgan Stanley note the index appears 17% cheaper than pre-war levels, suggesting potential stabilization-if oil prices don’t force the Federal Reserve to raise rates.
Treasury yields eased slightly, with the 10-year note falling to 4.34% from 4.44%, offering relief to real estate and dividend stocks. Alexandria Real Estate rose 0.7% on lower borrowing costs.
Alcoa jumped 8.8% on speculation that Middle East attacks on rival aluminum facilities could boost demand. Sysco plunged 15% after announcing a $29.1 billion acquisition of Jetro Restaurant Depot.
European markets rose, with London’s FTSE 100 up 1.6% and Paris’ CAC 40 gaining 0.9%. Asian markets tumbled: Seoul’s Kospi fell 3%, Tokyo’s Nikkei 2.8%, and Hong Kong’s Hang Seng dropped 0.8%.