Key Takeaways
- Equity futures (Dow Jones, S&P 500, Nasdaq) advanced Friday morning following Thursday’s significant losses, benefiting from a modest pullback in crude oil prices.
- Brent crude temporarily surpassed $100 per barrel—a level not seen since August 2022—before declining to approximately $99.
- Ongoing Middle East tensions, now entering their second week, have triggered what experts call the most significant oil supply disruption on record, with the Strait of Hormuz remaining blocked.
- Bitcoin rallied beyond $70,000, with market observers pointing to a social media post from Trump as a potential catalyst for the cryptocurrency’s climb.
- Market pricing now indicates a 47% probability that the Federal Reserve will skip rate cuts entirely in 2026, a dramatic increase from 3% just one month earlier, driven by mounting inflation concerns.
Equity futures posted gains Friday morning, recovering from Thursday’s selling pressure that pushed the three major indices to their lowest 2026 closing values. Futures contracts for the Dow Jones Industrial Average, S&P 500, and Nasdaq 100 each registered increases between 0.3% and 0.4% during pre-market hours.
The upward momentum came after an Axios report suggested President Donald Trump informed international leaders during a Wednesday virtual summit that Iran is nearing capitulation. White House officials have not publicly verified these statements.
Contradicting this narrative, Iran’s newly appointed supreme leader, Mojtaba Khamenei, declared Thursday his country’s commitment to continued military operations. He reaffirmed Iran’s position that the Strait of Hormuz will remain shuttered. This critical waterway serves as a vital artery for global petroleum transport.
The Israel-Iran confrontation reached its second week Friday. Israeli forces conducted additional strikes against Tehran, while Iran has been implicated in missile attacks targeting Dubai and Turkey. US military authorities also reported the deaths of four service members in a refueling aircraft accident.
Crude Prices Moderate But Remain High
Oil prices experienced a modest decline Friday after a turbulent trading week. West Texas Intermediate crude decreased roughly 2% to trade below $94 per barrel. Brent crude, the global pricing benchmark, retreated below the $100 threshold after closing above that mark Thursday for the first time in over two years.
Industry experts characterize the current oil supply disruption as unprecedented in scale. To address supply constraints, Washington authorized a second exemption permitting purchases of sanctioned Russian crude oil.
According to The Wall Street Journal, Indian government representatives are negotiating with Iranian authorities to secure passage for at least 23 oil tankers through the Strait of Hormuz. Initial crossings could materialize as early as this weekend, citing Indian officials.
Federal Reserve Rate Cut Probability Plummets
Inflation fears stemming from elevated oil prices have dramatically altered Federal Reserve policy expectations. CME FedWatch data reveals traders now assign a 47% probability to the Fed maintaining current interest rates throughout 2026, representing a sharp increase from merely 3% one month prior.
The 10-year Treasury yield stood at 4.28% Friday morning. The US dollar index advanced 0.3%, reaching a 3.5-month peak.
Market participants eagerly awaited Friday morning’s release of the Personal Consumption Expenditures price index, the Federal Reserve’s preferred inflation metric. Fourth quarter GDP figures and January’s JOLTS job openings data were also on the economic calendar.
Bitcoin breached the $70,000 threshold early Friday. Some market analysts attributed the cryptocurrency’s momentum to a social media post from former President Trump. Gold prices headed for a weekly decline, pressured by dollar strength.
Thursday’s single-day Brent crude rally marked the largest percentage gain since May 2020, highlighting the remarkable speed of this week’s market volatility.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
