S&P 500, Nasdaq Slide as Iran Conflict Keeps Oil Prices Elevated
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By Anders Bylund – Mar 27, 2026 at 12:51PM ESTKey PointsThe S&P 500 and Dow dropped 0.7% by midday Friday while the Nasdaq fell 1.1%.Energy and utility stocks bucked the trend, rising as other sectors sold off.The Strait of Hormuz conflict is restricting oil access from multiple major producers, not just Iran.If you were hoping Friday would bring some relief to your portfolio after a volatile week, well, the market had other plans. Rising oil prices and concerns about potential fuel supply disruptions are pushing equities lower across the board. At the heart of it all, of course, is the continuing conflict in Iran. ^DJI data by YCharts Shortly before midday ET, the S&P 500 (^GSPC 1.35%) and Dow Jones Industrial Average (^DJI 1.41%) indexes were down by 0.7%.
The Nasdaq Composite (^IXIC 1.92%) took a deeper dive of 1.1%. The Dow is back where it was a week ago, while the Nasdaq and S&P 500 indexes fell by 2.2% and 1.1%, respectively, over the last five days. Nearing the end of March, all three market trackers are down by approximately 7% for the month. Image source: Getty Images. The usual catalysts: Iran tensions and oil prices At the moment, investors aren't buying President Trump's latest attempts at Middle East dealmaking. Oil prices have been on a tear; the United States Oil Fund (USO +5.71%) jumped nearly 4% Friday and is up a staggering 48% over the past month. When oil spikes, it acts like a tax on everything, and the market knows it. This fund tracks crude oil prices closely, making it a quick dipstick for checking current trends in the energy market. Tech stocks are taking it on the chin. All of the Magnificent 7 stocks are down today, led by dips of at least 3% for Meta Platforms (META 4.27%) and Amazon (AMZN 3.58%). With trillion-dollar market caps, these moves make a significant difference to the woes of cap-weighted indexes, including the Nasdaq Composite and S&P 500. Energy and utility stocks generally rose on Friday, alongside upticks in the basic materials and consumer defensive sectors. The Nasdaq is underperforming since it has less exposure to the stock categories that are on the upswing. ExpandNASDAQINDEX: ^IXICNASDAQ Composite IndexToday's Change(-1.92%) $-411.26Current Price$20996.82Key Data PointsDay's Range$20957.42 - $21293.5052wk Range$15267.91 - $23958.47 What's at stake beyond today's sell-off The market appears to be pricing in prolonged uncertainty regarding the Iran situation. The implications of this conflict for energy costs and global supply chains are already massive, with spiking energy prices suggesting broadly higher consumer prices in the coming months. Until the Strait of Hormuz is unlocked, the global market will have limited access to oil and natural gas producers far beyond Iran. There are some pipelines in the region, but oil tankers remain the most effective way to ship fossil fuels out of this key region. The names include Iraq, Kuwait, Saudi Arabia, Qatar, Bahrain, and the United Arab Emirates. At the other end of the shipping lines, countries like South Korea, Japan, and China rely heavily on Middle Eastern oil. For long-term investors, moments like these can feel uncomfortable, but they're also when opportunities tend to emerge. Volatility isn't fun, but it's also not unusual. It's anyone's guess how long the war with Iran will last. Stay patient, stay diversified, and remember that the headlines driving today's sell-off won't last forever.Read NextMar 26, 2026 •By Sean WilliamsThe Nasdaq Composite Is Officially in Correction Territory: 3 Things You Need to KnowMar 26, 2026 •By Emma NewberyStock Market Today, March 26: Nasdaq Falls 2.4% After Meta and Micron Drop Sharply Mar 25, 2026 •By Keith NoonanWhy Velo3D Stock Is Plummeting TodayMar 24, 2026 •By Emma NewberyStock Market Today, March 24: Oil, AI, and Private Credit Fears Weigh on MarketsMar 22, 2026 •By Jeremy BowmanThe Nasdaq Is on the Verge of a Correction. 4 Things Investors Need To RememberMar 18, 2026 •By Keith NoonanBest Penny Stocks of 2026: Are They a Good Investment?About the AuthorAnders Bylund is a contributing Motley Fool media and technology analyst covering semiconductors, cloud computing, internet infrastructure, quantum computing, and streaming media. Previously, Anders was a systems administrator for Nielsen Technology and CSX, gaining hands-on experience with enterprise-class systems. He was also a freelance writer for Ars Technica, TIME, USA Today, CNN, WIRED, and AOL's Daily Finance. He holds a bachelor’s degree in English and a master’s degree in library and information sciences from Florida State University. He believes in coyotes and time as an abstract.TMFZahrimX@TMFZahrimStocks MentionedNASDAQ Composite IndexNASDAQINDEX: ^IXIC$20,997.26(-1.92%)-$410.82Dow Jones Industrial AverageDJINDICES: ^DJI$45,265.16(-1.51%)-$694.95S&P 500 IndexSNPINDEX: ^GSPC$6,384.59(-1.43%)-$92.57AmazonNASDAQ: AMZN$200.22(-3.53%)-$7.32Meta PlatformsNASDAQ: META$524.22(-4.26%)-$23.32United States Oil FundNYSEMKT: USO$123.95(+5.71%)+$6.69*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.