Global Markets Reel as Trump Signals Iran Conflict Escalates

U.S. equity futures fell and oil prices jumped late Wednesday, April 1, 2026, after President Donald Trump delivered remarks indicating the Iran war would continue. The move in futures reversed a more upbeat tone seen earlier in the U.S. cash session, when investors had been positioning for a faster end to the conflict.

In after-hours trading, S&P 500 futures dropped 0.8%, Nasdaq 100 futures declined 1%, and Dow Jones Industrial Average futures fell 352 points (0.8%). At the same time, crude prices surged, with West Texas Intermediate futures up 3.5% to above $103 a barrel and Brent futures rising more than 4% to above $105.

In his address, Trump said the U.S. was nearing the end of the conflict but also warned that the country would “hit” Tehran “extremely hard.” He added a threat to “bring them back to the stone ages where they belong” within two to three weeks. Markets that had been leaning toward a near-term de-escalation shifted quickly as traders recalibrated for the possibility of a longer and more volatile path.

Earlier on Wednesday, the main U.S. indexes had advanced during regular trading hours on hopes of a swift resolution to the U.S.-Iran conflict. The S&P 500 rose 0.72%, the Nasdaq Composite gained 1.16%, and the Dow added 0.48% before the late-day reversal in sentiment.

The risk-off tone carried into Asia-Pacific markets on Thursday. Japan’s Nikkei 225 fell 1.4%, South Korea’s Kospi dropped 2.82%, and Australia’s S&P/ASX 200 declined 0.48%, reflecting a broader reassessment of geopolitical risk and energy-price sensitivity across regional equities.

Market participants are now weighing the economic consequences of a conflict that may not end as quickly as previously hoped. Investors are focusing on the potential for sustained inflationary pressure alongside risks to global growth, a dynamic highlighted by T. Rowe Price’s chief investment officer, Sebastien Page.

Uncertainty remains centered on how long the conflict could last and how forcefully the U.S. campaign could intensify, given Trump’s two-to-three-week timeframe and his warning of heavier strikes. With oil prices already reacting sharply, traders are watching whether elevated energy costs persist and how that feeds into broader market pricing across equities and other risk assets.