U.S. stocks dropped sharply on Friday after a weaker than expected February jobs report rattled investors already grappling with surging oil prices and growing tensions in the Middle East. The Dow Jones Industrial Average fell nearly 700 points, or about 1.4%, while the S&P 500 slid roughly 1.3% and the Nasdaq Composite lost about 1.2% as risk-off sentiment swept through markets.
The sell-off followed a disappointing labor market report showing nonfarm payrolls unexpectedly fell by 92,000 in February, far below expectations for a gain of about 55,000 jobs. At the same time, the unemployment rate climbed to 4.4%, raising fresh concerns about the health of the U.S. economy at a moment when surging oil prices threaten to push inflation higher.
Market Movers:
- Day One Biopharmaceuticals (DAWN) +65% – Shares soared after the company agreed to be acquired by French pharmaceutical group Servier in an all-cash deal valued at roughly $2.5 billion. The transaction values Day One at $21.50 per share, representing a premium of roughly 68% to the stock’s previous close and significantly boosting investor enthusiasm.
- Marvell Technology (MRVL) +11% – Shares jumped after the semiconductor company reported strong quarterly results and issued upbeat guidance driven by surging AI demand. The company also highlighted record design wins and strong data center momentum that are expected to support continued revenue growth.
- Smith & Wesson Brands (SWBI) +8% – The firearm manufacturer gained after reporting better-than-expected fiscal third-quarter results fueled by strong handgun sales. The company also forecast fourth-quarter revenue growth of 10% to 12% as improving inventory management and stronger demand support margins.
- Samsara (IOT) +7% – Shares climbed after the industrial software platform posted quarterly revenue that beat analyst expectations and issued strong forward guidance. Management also highlighted accelerating adoption of its AI-powered data platform, which pushed annual recurring revenue to nearly $1.9 billion.
- GoPro (GPRO) -12% – Shares fell after the camera maker reported weaker-than-expected quarterly results and a drop in camera sales. Unit sell-through fell nearly 19% year over year, while subscription revenue also declined, raising concerns about slowing growth.
- Gap (GAP) -10% – Shares dropped after winter storms and store closures weighed on quarterly results and the retailer issued cautious guidance. The company forecast weaker margins in the coming quarter, which overshadowed modest sales growth expectations for the year.
- Western Alliance Bancorporation (WAL) -7% – The regional bank slid after filing a lawsuit against Jefferies related to a disputed commercial loan tied to the collapse of auto parts supplier First Brands Group. The bank said it plans to charge off roughly $126 million tied to the loan.
- Jefferies Financial Group (JEF) -6% – Shares fell after Western Alliance’s lawsuit alleged breach of contract and fraud connected to the same loan dispute. The case has introduced uncertainty around potential financial exposure tied to the failed lending arrangement.
Oil Prices Surge as Middle East Conflict Escalates
Energy markets remained at the center of investor concern as oil prices surged on fears the expanding conflict involving Iran could disrupt global supply. West Texas Intermediate crude jumped more than 13% to above $91 per barrel, while Brent crude climbed past $93, marking the biggest weekly rally in oil prices in roughly five years. Much of the concern centers on the Strait of Hormuz, a critical shipping lane responsible for roughly a fifth of global oil supply. Tanker traffic has slowed dramatically amid escalating military threats and rising insurance risks, fueling fears that energy markets could tighten significantly if the disruption persists.
Airline Stocks Sink as Jet Fuel Costs Soar
Airline stocks were among the hardest-hit sectors on Friday as jet fuel prices surged alongside crude oil. Shares of major carriers, including Delta Air Lines, United Airlines, and JetBlue, all moved sharply lower as investors priced in the impact of higher operating costs. Jet fuel prices have reportedly doubled to more than $4 per gallon, compared with an average of about $2 per gallon last year. Because fuel accounts for roughly 30% of airline operating expenses, the rapid spike is expected to weigh heavily on profit margins across the industry.
Bitcoin Pulls Back as Investors Turn Risk-Off
Cryptocurrency markets also retreated as investors reduced exposure to riskier assets following the weak jobs report. Bitcoin fell more than 4%, dropping below $68,000, after briefly rallying above $73,000 earlier in the week. The decline highlights the fragile sentiment across financial markets, where rising oil prices and signs of economic slowing are creating a difficult environment for both equities and digital assets.
Looking Ahead
Investors will now be closely watching how policymakers respond to the conflicting signals of a cooling labor market and rising inflation pressures driven by energy prices. Federal Reserve officials have already acknowledged the growing “two-sided risks” facing the economy, which could complicate the central bank’s policy path in the months ahead. At the same time, geopolitical developments in the Middle East remain a major wildcard for markets. If oil prices continue to climb or disruptions in global shipping worsen, volatility could remain elevated as investors weigh the risks of slowing growth against the possibility of renewed inflation.