European stock markets moved slightly higher on Friday, but investor sentiment remained cautious as the Middle East conflict continued to intensify and markets awaited key U.S. employment data.
At 03:05 ET (08:05 GMT), Germany’s DAX index rose 0.7%, France’s CAC 40 gained 0.3%, and the FTSE 100 in the United Kingdom advanced 0.2%.
Despite the modest gains, major European benchmarks are still on track to record weekly losses of around 5%, marking their largest declines since April last year.
Volatile week for global equities
It has been a turbulent week for global equity markets as investors assess the potential duration and economic impact of the escalating Middle East war on the global economy.
The conflict has now entered its seventh day and shows little indication of slowing.
Late Thursday, U.S. Secretary of Defense Pete Hegseth warned that military activity over Iran and its capital Tehran could intensify significantly. Meanwhile, Israel announced it had launched a broad wave of strikes targeting infrastructure in Tehran.
Iran has retaliated by targeting not only Israel but also several neighboring countries, including Gulf states, Cyprus, Turkey, and Azerbaijan, raising fears that the conflict could spread further across the region.
In a phone interview with Reuters, U.S. President Donald Trump said the United States should have a role in determining Iran’s future leadership following airstrikes that killed Supreme Leader Ayatollah Ali Khamenei last week.
Meanwhile, Mojtaba Khamenei, the son of the slain leader, has emerged as a potential successor, suggesting the Iranian government may not easily give in to external pressure.
Eurozone growth data and U.S. jobs report in focus
Aside from geopolitical developments, investors are also preparing for upcoming eurozone economic data.
Preliminary estimates suggest that eurozone GDP will show quarterly growth of 0.3% and annual expansion of 1.3% for the final quarter of last year.
However, the primary focus for global markets remains the U.S. nonfarm payrolls report, which will be released later on Friday.
Economists expect the U.S. economy to have created 59,000 jobs in February, following a stronger 130,000 increase in January, while the unemployment rate is projected to remain unchanged at 4.3%.
Corporate earnings updates
Investors are also reviewing the latest corporate earnings as the reporting season nears its conclusion.
Deutsche Lufthansa reported record annual revenue in 2025, although profitability remained limited as the airline’s operating margin stayed thin. The company also refrained from providing detailed 2026 profit guidance, citing ongoing uncertainty related to the Middle East crisis.
Meanwhile, British engineering group IMI announced a £500 million share buyback program after delivering its fifth consecutive year of mid-single-digit organic revenue growth.
Swiss semiconductor technology company Comet Holding reduced its dividend by roughly two-thirds after free cash flow dropped 80% in 2025, despite modest revenue growth. The company cited a weaker U.S. dollar and an unfavorable product mix as factors weighing on margins.
French digital services company Spie reported record annual profit, with revenue surpassing €10 billion for the first time in 2025.
Oil prices set for strong weekly gains
Oil prices stabilized on Friday but remained on track for significant weekly gains, as escalating tensions in the Middle East increased concerns about possible global supply disruptions.
Brent crude futures rose 0.3% to $85.68 per barrel, while U.S. West Texas Intermediate (WTI) gained 0.1% to $81.06 per barrel.
Since the start of the conflict earlier this week, Brent crude has surged about 18%, while WTI has climbed approximately 21%.
In an attempt to ease supply concerns, the United States announced it would temporarily allow the sale of Russian oil to India for a period of 30 days.
However, the move has done little to slow the surge in oil prices. Traders remain worried that the conflict could disrupt shipping through the Strait of Hormuz, a critical passage between Iran and Oman that carries roughly 20% of the world’s oil supply.
