U.S. stocks slumped sharply at the open Friday, with all major indexes in the red as investors fled risk assets following a dramatic escalation in Middle East tensions. The Dow Jones Industrial Average dropped 438 points, or 1.02%, to 42,529.1 shortly after the bell, while the Nasdaq Composite slid 0.95%, or 187.69 points, to 19,474.8. The S&P 500 was down 0.75%, shedding 45.28 points to trade near 5,999.

The rout comes in the wake of a massive Israeli airstrike on Iranian nuclear and military sites that killed several top officials, including Major General Hossein Salami, commander of Iran’s Revolutionary Guards. Iran has vowed a "harsh responese," prompting fears of further escalation in the region and rattling global markets.

The Israeli offensive—reportedly involving over 200 aircraft and striking more than 100 targets—marked a dramatic intensification of hostilities, triggering emergency responses across the region. Israel's Prime Minister Benjamin Netanyahu declared a national state of emergency, while the U.S. began evacuating non-essential personnel from its embassies in Bahrain and Kuwait.

Market reactions were swift. Oil prices surged over 6% on expectations of supply disruptions, driving up shares of major U.S. energy companies. Devon Energy jumped 6% premarket, with similar gains seen in Halliburton (+5.1%), ConocoPhillips (+4.4%), and Schlumberger (+4.2%).

“The risk to oil supplies is very high,” said Phil Flynn, analyst at Price Futures Group, pointing to fears Iran may retaliate by disrupting shipments through the Strait of Hormuz, a critical chokepoint for global crude exports.

Stephen Innes, managing partner at SPI Asset Management, called the events a “seismic escalation” and warned of a “potential macro regime shift,” adding that the implications extended far beyond the region and into the core of global risk pricing.

Safe-haven assets reacted in kind, with gold climbing over 1% to hit a record high above $3,440 per ounce, according to Dow Jones Market Data.

Adding to the turmoil, former President Donald Trump weighed in on Truth Social Friday morning, posting, “Two months ago I gave Iran a 60 day ultimatum to ‘make a deal.’ They should have done it! Today is day 61. I told them what to do, but they just couldn’t get there. Now they have, perhaps, a second chance!” The post is likely to further inflame tensions given Trump’s prior stance on Iran’s nuclear program.

As global investors brace for potential retaliatory action from Tehran and further instability in the energy markets, U.S. equities are facing their most volatile session in months. With risk-off sentiment dominating, investors are shifting their focus toward safe havens and defensive plays amid the uncertainty.