US stocks continued their decline in midday trading on Friday, with the Dow Jones Industrial Average briefly falling into correction territory. Meanwhile, Brent crude oil prices traded above $110 per barrel. The downturn was driven by events near the Strait of Hormuz, which heightened investor concerns over energy supplies. Additionally, recent remarks from former President Donald Trump failed to encourage traders to buy on the dip.
The Dow dropped 482.07 points, or 1.05%, to 45,478.04. The Nasdaq Composite fell 267.25 points, or 1.25%, to 21,140.83. The S&P 500 declined 57.76 points, or 0.89%, to 6,419.40.
The S&P 500 is on track for its fifth consecutive weekly decline, with a loss of more than 1% for the week. The technology-heavy Nasdaq has fallen over 2% so far this week, while the blue-chip Dow has remained largely unchanged.
On Thursday, the Nasdaq entered correction territory, down more than 10% from its record high last October. Losses extended into Friday's session. After briefly dipping into correction during morning trading, the Dow continued to hover near that threshold. It currently sits 9.6% below its recent peak. The S&P 500 is down about 8% from its all-time high.
Internationally, Brent crude futures rose 2%, trading above $110 per barrel. US West Texas Intermediate crude futures climbed 3%, surpassing $97 per barrel.
Former President Trump extended the deadline for attacking Iranian energy infrastructure to April 6, more than a week later than the original deadline set for Friday.
In a post on Truth Social, Trump stated, "At the request of the Iranian government, allow me to announce that I am suspending the deadline for targeting energy facilities. Negotiations are underway and proceeding very well, despite incorrect reports to the contrary from the fake news media and others. Thank you for your attention to this matter!"
This announcement is the latest signal that the Trump administration is seeking to end the US-Iran conflict. The ongoing hostilities have driven oil prices higher, impacting consumers at the gas pump and potentially costing Republican seats in the midterm elections.
A resolution to the conflict would be positive for equity markets, which have been declining since the US and Israel struck Iranian energy infrastructure on February 28.
Conflicting messages from the White House have not helped stabilize the situation. Some of Trump’s social media posts have continued to cause market volatility. Recent information has included reports of a potential ceasefire and negotiations with Iran—which Tehran has denied—as well as reports of additional US troops being deployed to the Middle East, suggesting preparations for a prolonged conflict or even a ground offensive.
Analysts note that the ultimate economic impact of the US-Israel campaign against Iran will largely depend on the duration of the conflict and how long energy infrastructure in the Persian Gulf remains under threat. The longer the situation persists, the more severe the consequences.
However, uncertainty remains for investors. Iran’s foreign minister reportedly told state media this week that Tehran has no intention of negotiating with the US, even as its leaders review a US proposal to end the war. Separately, media reports citing informed sources indicated that the Pentagon is considering sending an additional 10,000 troops to the Middle East.
The Islamic Revolutionary Guard Corps told state media that the Strait of Hormuz has been closed, warning that any movement through the critical waterway would face a severe response. Iranian state media also reported that a Thai-flagged cargo ship ran aground in the strait after being attacked earlier on Friday.
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