U.S. stock declines accelerated into the close and oil prices edged higher Friday as the nearly three-week-old war in the Middle East showed no signs of winding down.
The three major stock benchmarks fell sharply, suffering a third day of losses, led by the Nasdaq composite, which dropped 2% and now stands 9.6% below its record. All three major indexes fell for a fourth straight week, the first time that has happened for the Dow industrials since 2023.
Late Friday, after stocks closed for the day, President Trump said the U.S. is considering “winding down” its military operation in Iran, adding that other countries would need to police the Strait of Hormuz. Brent crude prices edged lower to around $108 a barrel after closing the regular session at $112.19.
Friday’s stock declines came as the Pentagon is sending additional Marines to the Mideast and Iran projects defiance, with the new supreme leader declaring that “safety must be taken away” from the country’s enemies. President Trump also lashed out at NATO members for not joining a U.S. effort to open the strait.
Brent crude oil futures, the international benchmark, rose 3.3% on the day. For the week, they rose 8.8%, and they are up 55% since the start of the month. So far this year, they have soared 84%.
Gold slipped, ending the week with a 9.5% decline that was its steepest since 2011. The Stoxx Europe 600 turned lower, wiping out morning gains, while Asian indexes mostly fell.
Treasury yields rose alongside the U.S. dollar. The 10-year yield moved up to 4.39% Rates traders are now considering the possibility of a Fed rate hike, assigning a roughly 30% chance of at least one rate increase by October, up from just 6% a day earlier, according to CME Group data.
On Thursday, U.S. officials sought to calm markets, with Treasury Secretary Scott Bessent saying the U.S. is considering removing sanctions from Iranian oil at sea. That would free up about 140 million barrels of oil and offer some reprieve to U.S. allies.
