STORY: Stocks fell across the board Friday after more clashes in the Middle East, with the Dow dropping about 1.8%, the S&P 500 more than 1% and the Nasdaq declining 1.3%.
Iran launched missiles at Israel in response to intensive Israeli strikes aimed at crippling Tehran's ability to build nuclear weapons.
Airline stocks fell on fears that fuel costs could climb, while defense stocks such as Lockheed Martin and Northrop Grumman rose.
Melissa Brown, managing director of investment decision research at SImCorp, says she thinks the effect of the conflict may be short-lived.
"Over the long-termn,I've seen studies that show that wars generally don't have a major impact on stock markets over you know, say a period of a few months to a few years with some obvious exceptions. [FLASH] If we don't see a huge escalation, particularly outside of the borders where we're already seeing the conflict, I think that investors are going to go back to the idea that the Fed's going to lower rates, that we're not going to be in a recession, and even with somewhat higher oil prices, we managed quite well with higher oil prices for the past few years."
Other stocks on the move included Photoshop maker Adobe, which lost more than 5%. The company raised its annual revenue forecast but that was overshadowed by concerns that the pace of its AI adoption was too slow.
And shares of Oracle jumped more than 7.5% to hit a record high. The stock is now up more than 21% in the two days since the technology company gave an upbeat forecast driven by demand for its AI services.
