Dow Jones, U.S. stocks post sharp drops after U.S. airstrike on Iran general

Jan. 3 (UPI) -- U.S. stocks and the Dow Jones Industrial Average failed to recover by the end of the day Friday from a sharp opening tumble following the killing of top Iranian commander Qassem Soleimani in Baghdad.

The Dow slid 240 points to 0.8 percent as trading opened, while stocks also took a sharp downward turn after the opening bell. By end of day, it was still down 235 points.

The S&P 500 index closed 0.7 percent lower than the previous day, but was up 0.1 percent from opening. The Nasdaq Composite futures following suit, closing 0.8 lower.

Fears that the Baghdad strike would escalate conflict in the Middle East brought produced a step back from the record-setting, year-end rally that had continued into the first few days of the new year.

Oil prices and safe-haven investments, however, surged Friday. U.S. Brent crude, the global benchmark, climbed 3.8 percent to $68.83 a barrel, while U.S. crude rose 3.7 percent to $63.46 per barrel. By day's end U.S. crude prices had slid to $63.05 per barrel and U.S. Brent crude was at $68.70.

"We know that this is an escalation of tension in the [Middle East] region," Steven Chiavarone of Federated Investors told MarketWatch. "The initial reaction will lead to a risk-off for equity markets and upward pressure on oil prices. But what we don't know is the timing and severity of Iran's expected reaction."