Global stock markets largely declined and oil prices rose again on Friday following Wall Street’s most significant single-day drop since the escalation of tensions with Iran, fueled by increasing skepticism regarding potential de-escalation efforts.
In European trading, the FTSE 100 in London closed down 0.3% at 9,939.96. The CAC 40 in Paris fell 0.7% to 7,718.97, although Germany’s DAX experienced a more substantial decline, losing 1.3% to close at 22,314.28.
Asian markets presented a mixed picture. Tokyo’s Nikkei 225 finished 0.4% lower at 53,373.07, and South Korea’s Kospi similarly decreased by 0.4% to 5,438.87, though it had fallen more sharply earlier in the trading day. Hong Kong’s Hang Seng bucked the trend, gaining 0.4% to 24,951.88 after an initial dip, while the Shanghai Composite index rose 0.6% to 3,913.72. Australia’s S&P/ASX 200 edged down 0.1% to 8,516.30. Taiwan’s Taiex fell 0.7%, and India’s Sensex suffered a 2.1% loss.
Thursday saw Wall Street register its worst performance since the beginning of the current period of heightened conflict with Iran. The S&P 500 dropped 1.7% to 6,477.16, marking its largest single-day decline since January. The Dow Jones Industrial Average fell 1% to 45,960.11. The Nasdaq composite experienced a steeper fall, declining 2.4% to 21,408.08, placing it 10% below its recent peak – a level commonly defined as a market “correction.”
The shift in market sentiment followed a week of fluctuating expectations surrounding potential negotiations between the United States and Iran aimed at de-escalating tensions. Earlier in the week, signals suggested a possible diplomatic opening, but these were quickly overshadowed by more assertive rhetoric.
U.S. President Donald Trump announced Thursday that he was postponing a planned military response targeting Iranian energy infrastructure. He also extended a deadline for Iran to reopen the Strait of Hormuz, a vital shipping lane for global oil and gas supplies, until April 6. The initial deadline had been set for a much earlier date.
U.S. Futures contracts were largely unchanged in trading on Friday morning, suggesting continued uncertainty among investors. The price of Brent crude oil continued its upward trajectory, reflecting concerns about potential disruptions to supply through the Strait of Hormuz.
The U.S. Energy Information Administration reported on Wednesday that crude oil inventories had fallen by 2.3 million barrels last week, adding to supply concerns. This report preceded the increased tensions and contributed to the initial rise in oil prices, which were then amplified by the geopolitical developments.
The Iranian government has maintained its position that it will not negotiate while under economic sanctions and has warned of retaliatory measures if attacked. Supreme Leader Ayatollah Ali Khamenei reiterated this stance in a public address on Friday, stating that Iran seeks a “lasting security” in the region but will not compromise on its principles.
The International Atomic Energy Agency (IAEA) continues to monitor Iran’s nuclear program, and its latest report, released earlier this month, confirmed that Iran is continuing to enrich uranium beyond the limits set in the 2015 nuclear deal. This remains a point of contention between Iran and Western powers.
