Major global stock markets fell for a second week as investors digested inflation worries fuelled by the escalating US-Israeli war with Iran.
Economic and policy events next week are expected to give investors clues to policymakers' movements in the midst of the conflict, which has entered its third week.
The highlight will be the US Federal Reserve meeting, where the central bank is expected to keep interest rates steady, in addition to a flurry of economic data from the world's biggest economy.
The central banks of Europe, England, Japan and others are also set to hold policy meetings, while China is slated to release economic data.
But perhaps more critical, investors will continue to be “watching for any developments in the Iran war and its impact on the global oil market”, analysts at the Wells Fargo Investment Institute said.
On Wall Street, indices fell for a second straight week, with the Dow Jones Industrial Average settling 0.26 per cent lower, the S&P 500 declining 0.61 per cent and the tech-rich Nasdaq Composite giving up nearly 1 per cent.
Earlier in the week, Wall Street regained some ground after US President Donald Trump said the war would be over soon, but lost momentum after hostilities continued to escalate.
“The distance between geopolitics and Wall Street suddenly feels much shorter than it did a few months ago”, said John Ulin, founder and managing principal of Florida-based Ulin & Co Wealth Management.
“When the world becomes more dangerous, what actually happens to markets? Should you rush into oil stocks betting on a geopolitical windfall, or cash out and head for the sidelines and wait for the dust to settle? The quick answer is neither. The best playbook for investing during war is usually doing nothing if you are properly diversified,” he said.
In Europe, London's FTSE 100 settled 0.4 per cent lower, also amid inflation worries stemming from the Iran war, which is expected influence the Bank of England's decisions moving forward.
Paris's CAC 40 shed nearly 1 per cent, while Frankfurt's DAX declined 0.6 per cent.
Earlier in Asia, bourses closed lower, taking cues from their global counterparts.
The Shanghai Composite and Hong Kong's Hang Seng index both fell almost 1 per cent, while Tokyo's Nikkei fell about 1.2 per cent.
In commodities, oil prices climbed back above $100 a barrel on Friday, after a sharp swing this week, as Iranian strikes on Gulf energy facilities and shipping through the Strait of Hormuz kept supply uncertainties elevated.
Brent rose 2.67 per cent to close at $103.14 a barrel, while West Texas Intermediate increased 3.11 per cent to $98.71 per barrel. Both recorded a fourth consecutive weekly gain.
Gold held above the $5,000 mark but settled lower over inflation fears and a stronger dollar. The precious metal, considered a safe-haven asset, dropped nearly 2 per cent to $5,020 an ounce.
Silver, which like gold has recorded a spectacular rise in recent months, fell more than 5 per cent to $80.61 per ounce.
