NEW YORK — The S&P 500 (^GSPC) extended losses into early March 2026 trading, pressured by escalating geopolitical tensions in the Middle East following U.S. and Israeli military strikes on Iran, which sent oil prices sharply higher and prompted a flight to safe-haven assets.

The benchmark index closed at 6,878.88 on Feb. 27, down 29.98 points or 0.43%, capping a volatile week that saw broader market retreats amid renewed inflation concerns from surging energy costs. On March 2, futures indicated further downside, with S&P 500 contracts sliding around 1% pre-market before opening lower, trading near 6,855-6,856 levels in early sessions with intraday ranges dipping to approximately 6,796 before partial recovery attempts.

The pullback reflects a classic risk-off environment triggered by weekend military actions. U.S. and Israeli forces targeted Iranian sites in what has been described as “Operation Epic Fury,” prompting fears of prolonged conflict, potential disruptions in the Strait of Hormuz — through which about one-fifth of global oil flows — and retaliatory measures. Brent crude surged as much as 8-13% at peaks, trading near $79-$82 per barrel early in the week, while West Texas Intermediate climbed toward $72-$73, marking multi-month highs and amplifying worries about sticky inflation.

Gold futures rallied over 3%, surpassing recent levels as investors sought protection, while the U.S. dollar strengthened against major currencies. The VIX, Wall Street’s fear gauge, elevated toward 20, signaling heightened volatility as traders braced for developments.

“The combination of geopolitical escalation and an oil shock is forcing a rapid repricing of risk,” one market analyst commented in a Monday note. “Higher energy prices threaten to delay any Federal Reserve easing cycle, putting pressure on valuations across equities, especially in growth-sensitive sectors.”

The S&P 500 has shown resilience earlier in 2026, with year-to-date performance modestly positive in some calculations around 0.5% to 1% despite February’s softness. The index ended the prior month lower overall, influenced by softer sentiment in AI and technology names amid broader rotation. However, the latest catalyst has accelerated the defensive shift, with energy and select industrial names providing relative outperformance while consumer discretionary, tech-heavy constituents and airlines faced headwinds from elevated fuel costs.

Broader indices mirrored the caution. The Dow Jones Industrial Average futures dropped over 500 points at one point, while the Nasdaq Composite — already under pressure from prior sessions — saw amplified declines due to its growth orientation. European and Asian markets opened sharply lower, with some benchmarks down 1-2% as the conflict’s global implications rippled outward.

Analysts noted that persistent oil elevation could complicate the economic soft-landing narrative that buoyed stocks through much of the cycle. Recent Producer Price Index data had already introduced hotter-than-expected inflation readings, and the energy spike risks reinforcing those trends ahead of key labor market reports and corporate earnings.

Despite the near-term turbulence, longer-term optimism lingers for some observers. The S&P 500 remains above key technical supports, including its upward-sloping 10-month exponential moving average in certain analyses, suggesting the broader uptrend intact unless escalation materially worsens. Defensive sectors like consumer staples have shown relative strength in recent rotations, while international exposure via emerging markets or Europe has outperformed in spots amid diversification plays.

Investors continue monitoring diplomatic channels for de-escalation signals, alongside upcoming economic releases that could influence Fed policy expectations. Any stabilization in the Middle East or cooling in oil markets might support a rebound in risk assets, though prolonged uncertainty keeps caution front and center.

The index’s valuation, trading at levels reflecting forward earnings growth tempered by macroeconomic risks, appears balanced for total return seekers willing to weather volatility. Consensus views maintain a constructive stance on U.S. large-caps, with emphasis on quality names resilient to energy shocks and potential rate path adjustments.

As March trading unfolds, the S&P 500’s performance will hinge on the trajectory of the conflict, commodity prices and incoming data. For now, the market digests the geopolitical shock, balancing growth potential against immediate headwinds from higher costs and uncertainty.

Texas Gov. Greg Abbott warned that Iranian “sleeper cells” operating inside the United States pose a serious threat following Operation Epic Fury, saying the danger must be taken “seriously” as the Lone Star State ramps up security efforts.

“You oftentimes see when there’s a war breaking out like this, where the United States may be going against a country like Iran, that you could have either sleeper [cells] or lone wolves acting,” Abbott told “Mornings with Maria” on Monday.

“That’s exactly why we increased the number of Texas Department of Public Safety officers to be patrolling the streets and patrolling sensitive areas and why I deployed the Texas National Guard to do the same thing,” he said.

FBI RAISES COUNTERTERROR TEAMS TO HIGH ALERT AMID IRAN TENSIONS

Texas Gov. Greg Abbott speaks during a news conference with U.S. Secretary of Agriculture Brooke Rollins at the Texas Capitol in Austin on Aug. 15, 2025. (Jay Janner/Austin American-Statesman via Getty Images / Getty Images)

Heightened tensions followed a deadly shooting in Austin early Sunday, when suspect Ndiaga Diagne, a naturalized U.S. citizen born in Senegal, opened fire near a bar in the downtown area, killing two and injuring 14 others.

Diagne wore a sweater reading “PROPERTY OF ALLAH” during the attack.

According to media reports, law enforcement officials found the flag of the Islamic Republic of Iran and photos of its leaders in his home.

IRAN REGIME ‘ABOUT TO COLLAPSE,’ PRINCE REZA PAHLAVI SAYS AS ECONOMIC CRISIS DEEPENS

A demonstrator holding portrait of Iran’s Supreme Leader Ayatollah Ali Khamenei reacts outside the City Hall during a protest against U.S. and Israeli attacks on multiple cities across Iran on February 28, 2026, in Los Angeles, Calif.  (Qian Weizhong/VCG/Getty Images / Getty Images)

“There are other details that will be coming out about the shooter and his connections to terrorism that will make clear [that] this was a lone wolf activity where this shooter intended to wreak havoc here in Texas, here in the United States, because of his ties and sympathies with Iran,” Abbott said.

Abbott and other Republicans have long cautioned against the consequences of open borders under the Biden administration. He echoed those warnings during his FOX Business appearance, telling Maria Bartiromo the shooting raises other questions.

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“It calls into question a lot of people like that who are here in the United Sates, who came from other countries,” he said.

“The United States has to do a far better job in trying to vet and… ongoingly evaluate those who have come to our country who could pose a danger.”

Fox News Digital’s Asra Q. Nomani contributed to this report.

The building society saw an increase in both revenues and profits during 2025

Leeds Building Society has reported a year of strong performance that saw it reach the milestone of having a million members.

The society has released its annual report for 2025 in which total income rose from £355.6m to £412.5m. Over the same period, operating profit increased from £137.5m to £198.6m.

As well as getting to a million members, the society’s savings balances rose to £26.1bn, though new mortgage lending cooled slightly.

The society said that its Income Plus range, which has a loan to income ratio of 5.5 times, had helped 900 first time buyers.

It also highlighted efforts to invest in its branch network, completing refurbishments in Harrogate, Halifax, North Shields, and relocating its South Shields branch. As part of its community involvement, it awarded more than £1m to 270 charities and community groups, as well as hitting a £300,000 fundraising target for the children’s charities Barnardo’s ahead of schedule. The target has now been increased to £500,000.

Annette Barnes, interim chief executive officer of Leeds Building Society, said: “Our performance in 2025 shows that our society is both financially strong and is moving confidently into the future. Over the past year we’ve made significant progress in upgrading our technology, including testing our first savings accounts and mortgage applications on our new system.

“We’re committed to providing our members with innovative products and the long-term support they need: faster and more intuitive digital experiences, alongside the personal, human interaction that remains so important to many. Development of our mobile app is also underway and is a key priority in 2026.

“We remain steadfast in delivering on our purpose of putting homeownership within reach of more people, generation after generation. Helping people buy their first home is one of the most important roles we play as a mutual, and we’re proud that nearly half of our new mortgages in 2025 supported first time buyers.”