Investing.com — U.S. stock index futures extended losses on Friday, after softer-than-expected labor market data. The escalating conflict in the Middle East also weighed on sentiment.
At 08:40 ET (10:35 GMT), Dow Jones Futures declined 0.9%, Futures slipped 0.9%, and Nasdaq 100 Futures fell 1.2%.
The main averages on Wall Street fell in the prior session, dragged down by a climb in oil prices as fears continued to swirl around the choking off of supplies through narrow Strait of Hormuz waterway south of Iran.
The lost nearly 785 points, or 1.6%, putting the index on track for its second negative week in a row and its worst week since last October. The S&P 500 fell about 0.6%, while the dipped nearly 0.3%.
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Surging oil prices hit sentiment
Sentiment has been hit hard this week as the conflict in the Middle East has seen U.S. crude futures spiking by almost 21%, with the fighting spreading to other parts of the Middle East and Persian Gulf, after the U.S. and Israel launched joint strikes against Iran, threatening oil flows out of the major producing region.
The surge in oil prices added to inflation worries, with average gasoline costs in the U.S. having jumped by 27 cents following the start of the assault to $3.25 per gallon, according to Reuters, citing data from travel group AAA.
Higher energy prices tend to pressure corporate margins and consumer spending, while also complicating the Federal Reserve’s efforts to bring inflation under control.
The conflict has shown few signs of ending, in fact U.S. Secretary of Defense Pete Hegseth stated late Thursday that “the amount of firepower over Iran and over Tehran is about to surge dramatically”, while Israel earlier Friday said it had started a “broad-scale” wave of attacks against infrastructure targets in Tehran,
U.S. President Donald Trump, speaking with Reuters in a telephone interview, also said the United States must have a role in deciding who will be the next leader of Iran after airstrikes killed Supreme Leader Ayatollah Ali Khamenei last week, suggesting that the U.S. could be involved in events in this country for some time to come.
U.S. loses 92k jobs in February
The spotlight on Friday was on February’s U.S. report.
In a negative surprise, the U.S. shed 92k jobs last month. Economists had been expecting an addition of 58k jobs. Meanwhile, the unemployment rate ticked up to 4.4%.
The payrolls report is expected to play a key role in shaping expectations for interest rate cuts by the Federal Reserve this year. A resilient labor market could give policymakers room to keep interest rates higher for longer.
Traders currently expect the Fed to ease policy later this year, although recent economic resilience and geopolitical risks have tempered expectations for aggressive rate cuts.
lifts revenue outlook
Turning to the corporate sector, semiconductor Marvell Technology (NASDAQ:MRVL) lifted its full-year revenue outlook thanks to strong ongoing data center spending by AI hyperscalers.
Mega-cap companies like Amazon and Microsoft have made AI a central focus of their operations, and plan to shell out billions of dollars to rapidly build out the data centers that power and train the nascent technology.
Firms like Marvell, which designs and proves the internal plumbing that connects data between large-scale computer systems, have been key beneficiaries of the heavy spending.
Elsewhere, clothes retailer ’s (NYSE:GAP) fiscal 2026 guidance disappointed investors concerned about tariff headwinds, while retailer (NASDAQ:COST) reported higher revenue and profit for the second quarter, while membership fees totaled $1.36 billion, reflecting a 13.6% gain year over year.
Crude set for hefty weekly gains
Oil prices surged higher Friday, on track for hefty weekly gains as escalating conflict in the Middle East raised concerns over global supply disruptions.
futures climbed 2.7% to $87.43 a barrel and U.S. West Texas Intermediate crude futures rose 4% to $84.26 a barrel.
In the previous four trading sessions since the war started, Brent has climbed 18% while WTI has gained 21%.
In a move to ease some supply concerns, the U.S. announced it would allow the sale of Russian oil to India for a period of 30 days.
However, this has hardly made a dent on the surging oil prices as traders have worried that the conflict will close the Strait of Hormuz, a narrow waterway between Iran and Oman, through which roughly 20% of the world’s oil supply passes.
Ayushman Ojha and Peter Nurse contributed to this article