Stocks showed signs of stabilization on Friday following a sharp sell-off, as investors navigated the ongoing tensions in the Middle East, particularly the conflict involving Iran, and prepared for important inflation data that could influence Federal Reserve policy.
Futures contracts for the Dow Jones Industrial Average and the S&P 500 were slightly lower, while Nasdaq 100 futures dipped by 0.2% amid volatile premarket trading. The market’s recent turmoil has been exacerbated by the intensification of the Iran war, which is now entering its second week. Fresh Israeli airstrikes on Tehran and retaliatory missile attacks linked to Iran targeting Dubai and Turkey have heightened anxieties. Additionally, reports surfaced that a U.S. military refueling plane crash in Iran resulted in the deaths of four crew members.
This escalating military conflict has prompted a significant increase in oil prices, leading to notable volatility in financial markets. The three major U.S. stock indices witnessed their lowest closing levels of 2026 on Thursday, with the Dow dropping over 700 points and closing below 47,000, marking a low not seen since last November.
In an attempt to mitigate soaring oil prices, the U.S. issued a second waiver for the purchase of sanctioned Russian oil. Despite this, analysts caution that ongoing threats from Iran to close the critical Strait of Hormuz will likely exacerbate what is already considered one of the largest disruptions to oil supply in recent history.
On Friday, oil prices experienced a slight easing, with West Texas Intermediate crude futures remaining below $95 per barrel. In contrast, Brent crude futures maintained levels above $100, which they reached for the first time since August 2022.
The surge in oil prices, coupled with persistent inflation concerns, has altered market expectations regarding Federal Reserve monetary policy ahead of next week’s meeting. Traders are now less inclined to bet on interest rate cuts for the remainder of the year. Investors are particularly focused on the forthcoming January data of the Personal Consumption Expenditures (PCE) price index, the Fed’s preferred measure of inflation, which is set to be released at 8:30 a.m. ET. Additionally, a revision of the Q4 U.S. GDP growth figure, which fell short of initial expectations, is also anticipated.
After a disappointing February jobs report, the Job Openings and Labor Turnover survey (JOLTs) will be scrutinized for insights into the labor market. Also, an early assessment of consumer confidence in March from the University of Michigan will provide further context on household sentiments.
In the premarket trading, several notable stocks were in focus. Dick’s Sporting Goods saw a 6% decline despite posting strong fourth-quarter earnings, as its guidance for the current fiscal year was mixed and fell short of analyst expectations. Meanwhile, shares in Strategy and Coinbase rose approximately 3% following a 2% increase in bitcoin prices. In contrast, SentinelOne’s stock dropped 5% despite meeting revenue targets in its fourth-quarter earnings report, with its April quarter forecast only aligned with estimates.
Ulta Beauty’s stock fell 8% after the retailer’s poised guidance for 2026 disappointed investors. Although revenue exceeded estimates, its earnings forecast for the full year fell short of Wall Street’s expectations, raising concerns about potential pressure on operating margins. The company’s same-store sales outlook also suggested a more cautious approach as Ulta gears up for a year following significant investments.
In other corporate news, ByteDance has signed a massive $2.5 billion deal to procure Nvidia chips outside China, reflecting the ongoing evolution of tech industry dynamics. Meanwhile, Adobe faced its own challenges as it announced the departure of its long-standing CEO after nearly two decades at the helm, contributing to a drop in its stock.
Investors continue to closely monitor these developments, balancing geopolitical risks against economic indicators as they navigate the current market environment.
