U.S. stock futures indicate a lower start for markets on Friday, pointing to potential additional losses after equities dropped sharply in the previous trading session.
A renewed jump in crude oil prices is expected to weigh on investor sentiment. Global benchmark Brent crude has climbed back above $110 per barrel after gaining more than 5% during Thursday’s trading.
The extended rally in oil prices comes even after President Donald Trump announced a 10-day extension to the pause on potential attacks targeting Iran’s energy infrastructure, pushing the deadline to April 6.
In a post on Truth Social, Trump said negotiations with Iran are “going very well,” though Iranian state media reported that Tehran had “responded negatively” to a peace proposal from the United States.
“Comments from Washington and Tehran about a potential peace process seem to come from parallel worlds, with the former indicating talks are going well while the latter effectively denies talks are even happening,” said AJ Bell investment director Russ Mould.
“For now, fighting continues and the path out of the current crisis remains unclear,” he added. “Oil prices, probably the best indicator, remain elevated and have reached $110 per barrel again.”
Mould also cautioned that if crude prices remain elevated for an extended period, concerns about a meaningful return of inflationary pressures could intensify.
Markets tumble in prior session
Stocks had already been under pressure earlier on Thursday and continued to decline as the session progressed, ultimately closing sharply lower. The sell-off pushed both the Nasdaq and the S&P 500 to their lowest closing levels since early September of last year.
The main indexes finished slightly above their intraday lows. The Nasdaq dropped 521.74 points, or 2.4%, to 21,408.08, the S&P 500 lost 114.74 points, or 1.7%, to close at 6,477.16, and the Dow Jones Industrial Average fell 469.38 points, or 1%, ending at 45,960.11.
Thursday’s decline continued the recent back-and-forth trading pattern, as markets reacted to sharp swings in crude oil prices.
Brent crude, the international oil benchmark, surged more than 5% after falling by over 2% during Wednesday’s session.
The rebound in oil prices reflects ongoing uncertainty around efforts to secure peace in the Middle East. Iran rejected a U.S. proposal aimed at pausing the conflict, stating that any ceasefire would occur only according to Tehran’s own terms and schedule.
In a Truth Social post, President Donald Trump described Iranian negotiators as “very different” and “strange,” while also claiming they are “begging” the U.S. to strike a deal.
“They better get serious soon, before it is too late, because once that happens, there is NO TURNING BACK, and it won’t be pretty!” Trump warned.
Escalation concerns add to market anxiety
Investor worries were also heightened after several Gulf nations issued a joint statement condemning Iran’s “criminal” attacks on their energy infrastructure.
The statement, released by the United Arab Emirates, Kuwait, Bahrain, Saudi Arabia, Qatar and Jordan, specifically cited attacks carried out by Iran-aligned armed factions operating from Iraqi territory.
“While we value our fraternal relations with the Republic of Iraq, we call on the Iraqi government to take the necessary measures to immediately halt the attacks launched by factions, militias, and armed groups from Iraqi territory toward neighboring countries,” the statement said.
The Gulf states also reaffirmed their right to defend themselves and their right to “take all necessary measures to safeguard our sovereignty, security, and stability.”
Tech and cyclical sectors lead losses
Technology-related shares were among the biggest losers of the session, with computer hardware, semiconductor and networking companies posting notable declines that weighed heavily on the tech-focused Nasdaq.
Outside the technology sector, gold mining companies also dropped sharply as bullion prices fell, pulling the NYSE Arca Gold Bugs Index down by 3.7%.
Steelmakers, homebuilders and airline stocks also recorded significant losses, while oil producers moved higher alongside the surge in crude prices.
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