The conflict is behind surging inflation in the US in March. The government reported the biggest spike in inflation in four years as prices at the gas pump jumped. The inflation increase was just short of what economists expected.

Bond yields rose a bit following the latest inflation update. The yield on the 10-year Treasury climbed to 4.32 per cent from 4.29 per cent late Thursday.

Inflation has been a lingering concern for economists. Prices on a range of consumer goods and services are already stubbornly high, in part from the impact of extensive global tariffs. Higher gas prices are immediately felt by drivers at the pump, but they could eventually raise prices on everything from food to airfare as companies pass along higher costs for shipping and fuel.

Analysts are warning that there might be a drawn out impact from the oil supply shock in the months ahead.

“While I’m glad to see the effects to be less than expected in March, the effects in April are now more likely to be worse,” Jamie Cox, managing partner for Harris Financial Group, wrote in a research note.

Consumer sentiment slumped 10.7 per cent in April, according to a closely watched monthly survey from the University of Michigan. It also shows that consumers are growing more worried about inflation, with year-ahead expectations surging to 4.8 per cent in April from 3.8 per cent in March.

Inflation remains a major concern for the Federal Reserve, which has signalled more caution amid worries about inflation reheating. The rate of inflation remains above the central bank's 2 per cent target. The threat of rising inflation will likely mean the central bank continues to hold interest rates steady. Several Fed officials have also said a rate hike may be needed if inflation doesn’t cool.

Lower interest rates help boost stocks and other investments by lowering borrowing costs. Interest rate cuts also risk worsening inflation.

Most companies in the S&P 500 lost ground Friday, with health care and financial company stocks driving much of the decline. Eli Lilly and Co. fell 1.6 per cent and Charles Schwab closed 2.5 per cent lower.

Technology stocks with hefty values helped offset losses elsewhere. Nvidia rose 2.6 per cent and Broadcom rose 4.7 per cent.

All told, the S&P 500 fell 7.77 points to 6,816.89. The Dow dropped 269.23 points to 47,916.57, and the Nasdaq gained 80.48 points to close at 22,902.89...