NEW YORK, March 27, 2026, 1:09 PM EDT
The Dow Jones Industrial Average slid another 0.9% Friday, deepening losses after Thursday’s 469-point tumble. With oil prices climbing and the outlook for a swift Middle East resolution dimming, investors dropped U.S. equities. The blue-chip index remained in the red, while the S&P 500 also lost ground and the Nasdaq took an even bigger hit by midday.
The Dow’s recent resilience—holding above 50,000 since Feb. 6—looks less secure now. That buffer’s fading. Rising crude prices have kicked inflation worries back into gear, and rate cuts from the Federal Reserve? Traders have stopped expecting them. Some are even bracing for possible hikes. The Nasdaq, for its part, is already in correction territory, down more than 10% from its latest peak.
The Dow dropped 0.90% by midday. The S&P 500 was down 0.88%, while the Nasdaq slipped 1.33%. Brent crude edged up to around $110.55 a barrel, and the 10-year U.S. Treasury yield pushed toward 4.44%—a combination that tends to spell trouble for equities, as pricier energy can lock in both inflation and higher borrowing costs.
Selling picked up again after U.S. President Donald Trump extended the deadline for Iran to reopen the Strait of Hormuz, the channel handling roughly a fifth of global oil flows. Investors weren’t reassured. Iran, for its part, didn’t signal any willingness to talk. “Words alone aren’t cutting it right now,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown. Reuters
Doug Beath, global equity strategist at Wells Fargo Investment Institute, pointed to mixed messages between Washington and Tehran as a reason investors were pulling back from equities, calling the environment the “fog of war.” Over at Motley Fool Asset Management, chief investment strategist Bill Mann described the level of uncertainty as “extreme,” adding that investors were simultaneously trying to figure out the winners and losers in the AI space. Reuters
Tech and communication-services stocks dragged the market lower. Nvidia and Microsoft dropped sharply; Alphabet and Meta also lost ground. Both the S&P 500 and Nasdaq slipped to lows not seen in over six months, with the Nasdaq sliding further into correction.
Consumers weighed in too. Sentiment, tracked by the University of Michigan, slid to 53.3 for March—the lowest since December. One-year inflation expectations ticked higher, now at 3.8% versus the previous 3.4%. That uptick hints the oil shock could be pushing into how households think about prices.
Joanne Hsu, who heads the University of Michigan’s Surveys of Consumers, noted that consumers aren’t necessarily bracing for “recent negative developments” to drag on. Still, she cautioned, that outlook could shift if the Iran conflict stretches out or if higher energy prices ripple through the economy. Nationwide economist Oren Klachkin added that weaker purchasing power and wealth might “pull consumer spending growth lower” in the second quarter. Reuters
Even so, the market’s resilience was on display: the Dow jumped 305 points Wednesday as oil slid over 2% and investors latched onto early hints of diplomatic movement. But Gene Goldman, chief investment officer at Cetera Investment Management, cautioned that “volatility to remain elevated” unless there’s a clearer timeline for the war’s end. Reuters
The risk is clear enough. Should the Strait remain blocked or oil keep pushing higher, bets could intensify that the Federal Reserve’s hands are tied—no cuts, maybe even a hike. That scenario spells more trouble for the Dow, even if it continues to outpace the Nasdaq. Right now, the average remains well under its early February record close of 50,115.67.
