NEW YORK/LONDON – Wall Street indexes tracked global stock markets modestly higher on Friday while oil dipped after U.S. President Donald Trump held off on a decision of whether to involve the U.S. military in the Israel-Iran conflict.

Israel and Iran continued trading attacks one week on from an Israeli assault on Iran, but markets took comfort after the White House said Trump will decide in the next two weeks whether the U.S. will intervene on Israel’s side.

The Dow Jones Industrial Average rose 0.42% in early trade, the S&P 500 popped up 0.24%, and the Nasdaq Composite edged up 0.1%.

“Any news flow that’s going to lean in the direction of de-escalation is going to be a market positive, and we’re seeing that to a certain extent here,” said Art Hogan, chief market strategist at B. Riley Wealth.

Oil Markets React to Geopolitical Uncertainty

Oil took a breather, with Brent down 2.9% to $76.56 per barrel, but the preceding days’ surge still left it on course to post a weekly gain.

Europe’s main bourses ended their session higher, following similar gains across Asia, although it was touch and go whether MSCI’s main world index would still rack up a second-straight weekly loss.

Uncertainty as to whether Trump would jump quickly into the Middle Eastern conflict, along with concerns about tariff-driven inflation flagged by the U.S. central bank, prompted market volatility earlier in the week.

Fears of disruption to global oil supplies had boosted prices.

“Brent crude is down 2.5% today in the clearest sign that fears over an imminent escalation in the Israel/Iran conflict have eased,” MUFG strategist Derek Halpenny said.

European foreign ministers were meeting their Iranian counterpart in Geneva on Friday, seeking a path back to diplomacy over its contested nuclear programme.

Asian Markets Show Strength Amid Global Tensions

Asian shares had gained overnight thanks to a 1.2% jump in Hong Kong’s Hang Seng, and as newly elected President Lee Jae Myung’s stimulus plans saw South Korea’s Kospi top 3,000 points for the first time since early 2022.

China’s central bank held its benchmark lending rates steady as widely expected in Beijing, while data from Japan showed core inflation there hit a two-year high in May, keeping pressure on the Bank of Japan to resume interest rate hikes.

That in turn lifted the yen and pushed down the export-heavy Nikkei in Tokyo.

Treasuries Lose Out

In the U.S. bond market, which was open again after a federal holiday on Thursday, benchmark 10-year notes rose 2.8 basis points to 4.423%, from 4.395% late on Wednesday.

“There’s a bit of a risk-on trade going on, meaning people aren’t really piling into Treasuries,” said Tom di Galoma, managing director at Mischler Financial Group.

Yields had edged higher on Wednesday when Federal Reserve Chair Jerome Powell said borrowing costs are still likely to fall in 2025.

Powell cautioned against holding on too strongly to forecasts and said he expects “meaningful” inflation ahead as consumers pay more for goods due to the Trump administration’s planned import tariffs.

The dollar was set for its biggest weekly rise in more than a month despite Friday’s modest decline, indicating some investors still sought traditional safe havens.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.15% to 98.82, with the euro up 0.1% at $1.1505.

But gold, another traditional refuge, fell 0.13% to $3,365.89 an ounce.

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(Reporting by Marc Jones; Editing by Louise Heavens and Rod Nickel)