On Friday, the S&P 500 Index closed down 1.67%, the Dow Jones Industrial Average fell 1.73%, and the Nasdaq 100 dropped 1.93%, marking a seven-month low for the S&P 500 and a 6.75-month low for both the Nasdaq and Dow. Global bond yields surged, with the 10-year U.S. Treasury yield rising to an 8.25-month high of 4.48%, driven by concerns over a prolonged war in Iran that threatens to elevate oil prices and inflation.
The conflict has escalated, with the U.S. and Israel targeting nuclear facilities in Iran as the war enters its 27th day. Meanwhile, Saudi Arabia intercepted missiles aimed at Riyadh, and Kuwait reported drone strikes on its ports. In oil markets, WTI crude surged over 5%, exacerbated by disruptions to approximately 7.5% of global oil supply due to the conflict, with predictions that prices could exceed $150 a barrel if tensions persist.
Additionally, the University of Michigan’s consumer sentiment index for March was revised downward to 53.3, below expectations, while one-year inflation expectations rose to 3.8%. In a related move, China launched investigations into U.S. trade practices, adding to global market uncertainties.
