Global markets fall after weak US jobs data, rising oil risks

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Global markets fall

Employment forecasts fail to materialize

U.S. stock markets opened on Friday with major indices falling by more than 1%, while the combined market value of American companies dropped by about $800 billion. The broad sell-off was triggered by a weak February nonfarm payrolls report, which showed a loss of 92,000 jobs instead of the expected gain of 55,000, as well as concerning inflation and unemployment data.

According to the U.S. Department of Labor, the unemployment rate rose to 4.4%, while the share of people unemployed for 27 weeks or longer reached 25.3% of total unemployment.

Healthcare was the only sector to show growth amid the overall stagnation in employment, adding 9,000 jobs in February. However, the situation was clouded by strikes that kept 31,000 workers from reporting to work.

It is therefore unsurprising that Guy Berger, director of economic research at the Burning Glass Institute, described the February figures as a “terrible report.”

“A significant drop in nonfarm employment and a jump in the unemployment rate represent a victory for the ‘pessimist camp’ and a failure for the ‘acceleration camp,’” Berger said.

Meanwhile, weak macroeconomic data heightened investor anxiety, while geopolitical tensions in the Middle East added further risks through the energy market.

Markets brace for higher volatility

Iranian Foreign Minister Abbas Araghchi told NBC News that Iran has no intention of entering negotiations and is prepared for a ground invasion. At the same time, Qatar’s energy minister told the Financial Times that oil prices could surge to $150 per barrel within two to three weeks if the Strait of Hormuz remains blocked.

According to the International Energy Agency, around 20 million barrels of oil and petroleum products passed through the Strait of Hormuz daily last year. However, maritime traffic has sharply declined due to Iranian threats.

To ease logistical pressures, the U.S. Treasury’s Office of Foreign Assets Control issued a temporary authorization allowing India to purchase Russian oil already at sea.

Bloomberg reported that Indian refiners have already bought more than 10 million barrels of Russian crude, although much of it may have been purchased before the announcement in Washington.

Even if traffic through the Strait of Hormuz partially recovers—an area responsible for about 20% of global oil supplies—Goldman Sachs forecasts the average price of oil futures at $76 per barrel in the second quarter, while Brent crude prices are likely to exceed $100.

Historically, prolonged military confrontation in a key oil-producing region tends to weigh on technology giants and transport companies, whose profits suffer as investors shift toward safer assets.

Cryptocurrencies often fall alongside equities. Although Bitcoin’s recent rally earlier this week suggested exceptions can occur, the total crypto market capitalization dropped more than 3% on Friday to $2.32 trillion. Bitcoin fell below $69,000 and is approaching $68,000, while Ethereum slipped back below $2,000.

Rising energy prices could also complicate the Federal Reserve’s efforts to control inflation. Higher oil and fuel costs directly increase transportation expenses, logistics costs, and production prices, potentially accelerating consumer inflation once again. In such a scenario, the Fed may be forced to keep interest rates elevated for longer, which traditionally puts pressure on equities, particularly in the technology sector.

Amid growing uncertainty, investors are increasingly shifting into a “risk-off” mode, reducing exposure to more volatile assets. In such periods, capital typically flows into U.S. government bonds, gold, and the dollar, while technology stocks, transportation shares, and cryptocurrencies experience heightened volatility.

As we wrote, Brent crude tops $90 after Trump demands Iran unconditional surrender

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