Stocks Mixed Early as CPI, Oil Shock From Iran Conflict Drive Volatility

U.S. stocks were mixed early Friday as investors digested fresh inflation data and assessed the economic fallout from the Iran conflict, with energy prices driving renewed uncertainty around the Federal Reserve’s policy path.

The Dow Jones Industrial Average fell 155.28 points, or 0.32%, to 48,030.5, while the S&P 500 rose 9.89 points, or 0.14%, to 6,834.55. The Nasdaq Composite gained 135.03 points, or 0.59%, to 22,957.4.

The primary focus for markets was the March Consumer Price Index release, which comes at a pivotal moment for inflation trends. Prior data from the Labor Department showed prices rising 2.6% annually in March reflecting persistent underlying pressures. Headline CPI inflation rose 3.3% higher than a year ago and 0.9% on a monthly basis over February's reading. Shelter and food costs continued to contribute meaningfully to price gains, while energy prices had begun to accelerate.

That dynamic has shifted more sharply in March. Economists expect inflation to reheat as the Iran conflict pushes oil and gasoline prices higher, potentially ending the disinflationary trend seen over the past year. The conflict has disrupted energy flows and driven volatility in crude markets, with U.S. oil futures hovering near $98 per barrel in early trading.

Markets have also been tracking developments around a potential ceasefire in the Iran war, though uncertainty remains high. Negotiations are scheduled to begin later today. While any de-escalation could ease pressure on energy prices, analysts caution that supply disruptions and elevated transportation costs may continue to filter into broader inflation metrics

The CBOE Volatility Index, or VIX, slipped to 19.24, suggesting subdued but still elevated risk sentiment. Meanwhile, gold prices fell 0.5%, indicating reduced immediate demand for safe-haven assets despite geopolitical tensions.

Looking ahead, markets will continue to monitor inflation data, oil price movements, and the Iran war negotiations for direction. The trajectory of the Iran conflict, and whether a durable ceasefire emerges, remains a key variable shaping both inflation and financial markets in the weeks ahead.