Dow closes down 450 points as Iran war sends oil prices surging
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City. (Photo by Spencer Platt/Getty Images)
(NEW YORK) — The Dow Jones Industrial Average closed down 450 points on Friday as the Iran war continued to spike oil prices.
The Dow fell 453 points, or 0.9%, while the S&P 500 dropped 1.3%. The tech-heavy Nasdaq declined 1.5%.
In a post on social media on Friday morning, President Donald Trump appeared to rule out a compromise with Iran.
Trump said there would be “no deal with Iran except UNCONDITIONAL SURRENDER!”
Oil prices soared as traders feared a prolonged blockade of the Strait of Hormuz, a trading route that facilitates the transport of about one-fifth of the global oil supply.
U.S. crude oil prices topped $90 on Friday, marking a staggering 35% increase from a week earlier.
The stock selloff on Friday extended losses from a day earlier, when the Dow closed down 785 points.
Alongside fallout from the Middle East conflict, a jobs report on Friday showed the U.S. economy unexpectedly lost jobs in February, marking a reversal of fortunes for the labor market.
The unemployment rate ticked up from 4.3% in January to 4.4% in February, the BLS said. Unemployment remains low by historical standards.
The Iran war threatens to slow U.S. economic growth since oil-driven price increases could weigh on consumers and businesses, analysts previously told ABC News.
The potential combination of higher inflation and slower growth could also pose a challenge for the Fed, putting pressure on both sides of its dual mandate to manage prices and maintain maximum employment.
The central bank held interest rates steady at its most recent meeting in January, ending a string of three consecutive quarter-point rate cuts.
(NEW YORK) — The U.S. recorded strong job gains in March, rebounding from dismal losses a month earlier, a jobs report on Friday showed. The reading far exceeded economists’ expectations.
The U.S. added 178,000 jobs in March, according to the report, which marked a sharp increase from 133,000 jobs lost in the previous month.
The unemployment rate ticked down to 4.3% in March from 4.4% in February, the Bureau of Labor Statistics (BLS) said. Unemployment remains low by historical standards.
The BLS collected survey data through the second week of March, before the full effects of the oil shock set off by the Iran war.
As in previous months, the health care sector stood out as a top source of hiring in March, adding 76,000 jobs, the BLS said. The construction sector, as well as transportation and logistics, also contributed to the surge in hiring.
Employment in the federal government continued to decline in March, shedding 18,000 jobs, the BLS said. The federal government has lost 355,000 jobs, or nearly 12% of its workforce, since October 2024, a month before President Donald Trump was elected.
The government report arrived as the war continues to drive up gasoline prices and borrowing costs, threatening a drag on the economy.
The U.S. added an average of about 15,000 jobs per month in 2025, U.S. Bureau of Labor Statistics (BLS) data showed. That performance amounted to a sharp slowdown from 186,000 jobs added each month in 2024.
The U.S.-Israeli war on Iran, which began on Feb. 28, triggered one of the worst global oil shocks in decades, prompting gloomy forecasts on Wall Street of a potential U.S. recession over the coming months.
In theory, a prolonged oil shortage could drive up prices for a vast array of goods, sapping energy from consumer spending, which powers most of the nation’s economic growth.
Iran has mounted an effective closure of the Strait of Hormuz, a critical maritime trading route that facilitates the transport of about one-fifth of the global oil supply.
The U.S. is a net exporter of petroleum, meaning the country produces more oil than it consumes. But since oil prices are set on a global market, U.S. prices move in response to swings in worldwide supply and demand.
The disruption in oil shipping has pushed U.S. crude prices above $110 a barrel, which marks a staggering rise of more than 50% since the war began on Feb. 28.
Gasoline prices in the U.S. ticked up to $4.08 on average per gallon as of Wednesday, marking a leap of $1.09 over the past month, AAA data showed.
A potential jump in costs for additional goods delivered through the Strait of Hormuz — such as fertilizer and diesel fuel — could also raise prices beyond gasoline, putting pressure on the Federal Reserve to hike interest rates in an effort to quell possible inflation.
The benchmark interest rate stands at a level between 3.5% and 3.75%. That figure marks a significant drop from a recent peak attained in 2023, but borrowing costs remain well above a 0% rate established at the outset of the COVID-19 pandemic.
If the Fed moved to raise interest rates, it would hike borrowing costs for many consumer and business loans, risking a slowdown in hiring.
Speaking at Harvard University on Monday, Fed Chair Jerome Powell said the central bank could take a patient approach as it monitors potential price effects from the Middle East conflict.
“We feel like our policy is in a good place for us to wait and see how that turns out,” Powell said.
Editor’s note: This story has been updated to reflect the time period covered by the BLS survey.
A television station broadcasts the Federal Reserve’s decision to hold rates after a Federal Open Market Committee meeting on the floor of the New York Stock Exchange. (Michael Nagle/Bloomberg via Getty Images)
(NEW YORK) — The Federal Reserve held interest rates steady on Wednesday at its first meeting since the U.S.-Israeli war with Iran drove up gasoline prices and risked a wider bout of inflation.
The central bank’s move marked the second consecutive time it has opted to maintain interest rates at current levels since the outset of 2026. Before that, the Fed cut interest rates a quarter-point three straight times. The decision on Wednesday matched market expectations.
“The implications of developments in the Middle East for the U.S. economy are uncertain,” the Federal Open Market Committee (FOMC), a policymaking body at the Fed, said in a statement on Wednesday.
Elevated price increases have coincided with a slowdown of economic growth, threatening to intensify an economic double-whammy known as “stagflation,” which poses difficulty for the Fed.
If the Fed opts to lower borrowing costs, it could spur growth but risk higher inflation. On the other hand, the choice to raise interest rates may slow price increases but raises the likelihood of a cooldown in economic performance.
The benchmark rate stands at a level between 3.5% and 3.75%. That figure marks a significant drop from a recent peak attained in 2023, but borrowing costs remain well above a 0% rate established at the outset of the COVID-19 pandemic.
A lackluster jobs report last week showed the U.S. economy lost 92,000 jobs in February, which marked a reversal of fortunes for the labor market and erased most of the job gains recorded in 2026.
The unemployment rate ticked up from 4.3% in January to 4.4% in February, the BLS said. Unemployment remains low by historical standards.
A revised government report last week on gross domestic product (GDP) showed the economy grew at a sluggish annualized pace of 0.7% over the final three months of 2025.
Those economic headwinds helped set the conditions before the outbreak of war with Iran, which spiked oil prices and risked price increases for a host of diesel-fuel transported goods.
U.S. crude oil prices rose to about $97 per barrel on Wednesday, marking a surge of more than 50% since a month earlier.
Since the military conflict began, U.S. gas prices have gone up 86 cents to an average of $3.84 per gallon as of Wednesday, according to AAA.
The rate decision on Wednesday marked the first such move since a federal judge blocked Justice Department subpoenas to the Federal Reserve’s Board of Governors after determining the government “produced essentially zero evidence” to support a criminal investigation of Fed Chair Jerome Powell, according to an unsealed court opinion.
“A mountain of evidence suggests that the Government served these subpoenas on the Board to pressure its Chair into voting for lower interest rates or resigning,” U.S. District Judge James Boasberg said in his opinion on Friday.
Acting U.S. Attorney Jeanine Pirro blasted Boasberg as an “activist” judge and pledged to appeal his ruling.
ABC News’ Alexander Mallin, Allison Pecorin, and Jack Date contributed to this report.
Live Nation logo. (Photo by Jonathan Raa/NurPhoto via Getty Images)
(NEW YORK) — Live Nation illegally monopolized the market for tickets, protecting its position through pressure and leverage, jurors in Manhattan federal court found Wednesday.
This is a developing story. Check back for updates.
