Quick Summary
- Major US indices declined on Friday, with the Nasdaq falling 1% and moving deeper into correction
- Crude oil jumped more than 2%, with Brent exceeding $103 per barrel amid ongoing Middle Eastern tensions
- President Trump pushed back his Iran strike deadline to April 6, a 10-day extension that failed to boost investor sentiment
- The S&P 500 headed toward its fifth consecutive weekly loss, marking the longest slump since spring 2022
- Market volatility surged with the VIX climbing to approximately 30, indicating expectations of continued turbulence
American equities extended their losses on Friday as energy costs surged and market participants remained skeptical about a swift resolution to the Iran situation.
The Nasdaq Composite declined 1%, sinking deeper into correction territory. The Dow Jones Industrial Average shed approximately 500 points, representing a 1.1% decrease. The S&P 500 tumbled nearly 1%.
The S&P 500 is currently tracking toward its fifth consecutive weekly downturn. This would represent the index’s longest losing streak since the spring of 2022.
Oil prices emerged as a primary catalyst behind the market decline. Brent crude surged past the $103 per barrel threshold. West Texas Intermediate exceeded $97. Both key benchmarks registered gains exceeding 2% during Friday’s session.
Energy prices rallied despite President Trump’s decision to extend his Iran ultimatum. The president had initially indicated the US would target Iran’s energy facilities if negotiations failed by Friday. On Thursday evening, he postponed that deadline to April 6 following a request from Iran.
Investors did not interpret the deadline extension positively. Concern persisted that the temporary reprieve merely allows elevated oil prices additional time to damage global economic growth.
“It’s another one of those days where futures drift lower throughout the morning as traders follow the new daily routine of getting up, brushing their teeth, and clicking ‘Sell,'” said Paul Hickey, co-founder of Bespoke Investment Group.
Shipping through the Strait of Hormuz has been suspended due to the escalating conflict, intensifying pressure on energy markets. Iranian officials have thus far rebuffed American diplomatic overtures.
Volatility Index Climbs
The CBOE Volatility Index surged 2.6 points to hover near 30, a threshold that indicates market participants anticipate challenging conditions in the coming weeks.
Hickey observed that the Nasdaq is approaching its 10th weekly decline within the past 11 weeks. He emphasized that such persistent downward momentum has occurred during only a handful of periods throughout the index’s entire existence.
Consumer sentiment figures published Friday also revealed increasing pessimism among American consumers.
Treasury yields displayed mixed performance during the session. Ten-year yields reached an eight-month peak earlier this week, with certain market observers suggesting that bond market stress might encourage Trump to pursue a faster resolution to the conflict.
Senate Approves Shutdown Legislation
The Senate approved legislation early Friday morning to finance the TSA and additional Department of Homeland Security functions, although ICE funding was excluded. The legislative action moves closer to resolving a partial federal government shutdown that has caused airport disruptions and sparked concerns about economic consequences.
Gold experienced additional downward pressure from central bank reserve liquidation, based on market intelligence from Friday morning.
By midday Friday, the Dow had dropped more than 500 points, the S&P 500 had declined roughly 1%, and the Nasdaq had fallen 1.3%.
