Major stock indexes around the world closed mostly lower on Friday, capping a turbulent week dominated by the ongoing U.S.-Iran conflict, spiking oil prices and disappointing U.S. employment figures that raised concerns about economic slowdown and persistent inflation.

The Dow Jones Industrial Average fell 453.19 points, or 0.95%, to settle at 47,501.55. The broader S&P 500 declined 90.69 points, or 1.33%, to 6,740.02, while the tech-heavy Nasdaq Composite dropped 361.31 points, or 1.59%, to 22,387.68. All three major U.S. benchmarks posted weekly losses, with the Dow down nearly 3%, the S&P 500 off about 2% and the Nasdaq slipping 1.2%.

The sell-off reflected broader unease over the Middle East war entering its second week. Oil prices surged, with Brent crude topping $90 a barrel at points amid supply disruptions, including halted exports from key producers and blocked transport routes. Higher energy costs fueled fears of renewed inflationary pressures, prompting traders to pare expectations for central bank rate cuts.

In Asia, Japan’s Nikkei 225 rose 0.62% to close around 55,620, benefiting from a weaker yen and some resilience in export-oriented sectors. Hong Kong’s Hang Seng Index advanced 1.72% to 25,757.29, supported by mainland Chinese stimulus hopes despite ongoing property sector challenges. Chinese markets showed mixed performance amid Beijing’s reaffirmed 2026 CPI target of around 2%, viewed by economists as a ceiling rather than a firm goal.

European shares were mixed earlier in the week but ended the period with gains in some sessions as investors rotated toward value and defensive names. The pan-European STOXX 600 index recovered partially from earlier losses tied to energy price volatility.

The week’s volatility stemmed from several converging factors. Geopolitical risks escalated following U.S.-Israel actions against Iran, disrupting global energy flows and sending crude higher. Analysts warned that prolonged conflict could spike euro zone inflation and curb growth, with ECB Chief Economist Philip Lane noting potential substantial impacts.

U.S. economic data added to the caution. February’s jobs report disappointed, showing weaker-than-expected hiring and contributing to fears of labor market softening. Combined with firmer producer price index readings earlier in the year, the data reduced bets on Federal Reserve rate cuts. Markets now price in no cuts until potentially June or later, with probabilities for easing in 2026 scaled back.

Inflation remains a key concern globally. J.P. Morgan Global Research forecasts core CPI stable at 2.8% worldwide in 2026, with 3.2% in the U.S., 2.4% in the U.K. and 1.9% in the euro area. Regional cross-currents, including energy-driven pressures, complicate the picture. The Fed is expected to hold steady amid elevated price risks, while the ECB appears paused and the Bank of England tilts dovish.

Despite the headwinds, some positive undertones persist. Corporate earnings have shown resilience, particularly in AI-related sectors, though rotation away from mega-cap tech toward industrials, materials and energy occurred amid defensive positioning. International equities outperformed U.S. large-caps in recent periods, with developed markets outside the U.S. posting stronger returns.

J.P. Morgan Global Research maintains a positive stance on equities for 2026, forecasting double-digit gains in both developed and emerging markets, driven by robust earnings, lower rates over time and AI capital expenditure broadening.

Cryptocurrencies provided a bright spot amid the equity weakness, with bitcoin rallying significantly in some sessions, boosting related stocks like Coinbase and MicroStrategy.

Looking ahead, investors face a data-heavy calendar, including upcoming U.S. and China inflation releases, U.K. GDP and further trade figures. Central bank commentary will remain in focus as policymakers navigate the balance between growth support and inflation control.

The recent market swings underscore the challenges of operating in an environment marked by geopolitical uncertainty and macroeconomic cross-currents. While long-term outlooks remain constructive on fundamentals like corporate balance sheets and technological innovation, near-term sentiment hinges on de-escalation in conflicts and clearer signals from energy markets.

As trading resumes next week, attention will turn to whether stabilization in oil and any diplomatic progress can ease pressures, or if sustained higher costs force further reassessment of monetary policy paths.