Market Overview

At 11:27 ET (15:27 GMT) the S&P 500 index climbed 0.6% to 7,451.79 points, the Dow Jones Industrial Average added 0.7% to 52,069.29 points, and the Nasdaq Composite erased its prior decline, posting a modest 0.1% gain to 25,159.55 points. The recovery followed a heavy sell‑off on Thursday triggered by escalating Middle‑East tensions that sent Brent crude futures briefly above $100 per barrel.

Geopolitical and Energy Drivers

Iran‑backed Houthi militants launched attacks on Saudi tankers in the Red Sea, prompting a surge in oil prices and raising concerns of an energy‑driven inflation burst. The spike in Brent prices pressured markets, prompting expectations that central banks, including the Federal Reserve, may tighten monetary policy. U.S. Treasury yields rose, adding further weight to equity valuations.

> "The continued rise in energy prices is starting to put pressure on financial markets more broadly, beyond just the bond market. While central banks continue to take a measured approach to the renewed surge in energy prices, there is still plenty of scope for the turbulence in markets to ratchet higher if the U.S‑Iran conflict continues to escalate," said Jonas Goltermann, Chief Markets Economist at Capital Economics.

Brent oil retreated later on Friday but remained on track for a sharp weekly gain. The U.S. military reported completing a 13th consecutive wave of strikes against Iranian targets, including drone storage sites and coastal surveillance posts, aimed at limiting Tehran’s ability to threaten commercial shipping in the Strait of Hormuz.

Iran rejected a U.S.‑backed cease‑fire proposal presented by Iraqi Prime Minister Ali al‑Zaidi, refusing a temporary deal that left the control of the Strait of Hormuz unresolved.

Corporate Earnings and Sector Sentiment

Tech earnings added to market volatility. Alphabet (Google) and Tesla reported disappointing results, which analysts at Vital Knowledge argued contributed more to Thursday’s market wipe‑out than the geopolitical shock. By contrast, Intel posted second‑quarter earnings that beat Wall Street expectations, driven by strong demand for AI‑related chips. Intel’s shares rose more than 5% in pre‑market trading on Friday.

Economic Data Outlook

A flash reading of U.S. manufacturing and services sector activity for July from S&P Global is scheduled for release on Friday, providing further insight into the health of the economy amid the current backdrop.

Trade Policy Developments

President Donald Trump announced new double‑digit tariffs ranging from 10% to 12.5% on imports from 60 countries, citing inadequate enforcement of forced‑labor bans by trading partners. Canada and the European Union are each subject to a 10% tariff despite having domestic laws prohibiting forced‑labor imports. The tariffs replace a global 10% levy that expired after the Supreme Court struck down the administration’s earlier emergency economic powers duties in February. Media reports suggest additional tariffs could be announced in the coming weeks to address perceived unfair trade practices in the manufacturing sector.