Global stocks fell on Thursday, weighed by tepid trading in equity markets across the U.S. and other major regions, while oil prices jumped, buoyed by rising geopolitical tension from the Middle East conflict.

Wall Street's main indexes finished lower after trading slightly higher early in the session. Data released on Thursday showed rising U.S. jobless claims, indicating labor market softness, but strong service-sector activity. The closely watched nonfarm payrolls report for September is due on Friday.

The Dow Jones Industrial Average DJI fell 0.44% to 42,011.59, the S&P 500 SPX fell 0.17% to 5,699.94 and the Nasdaq Composite IXIC fell 0.04% to 17,918.48.

European stocks finished down 0.93% SXXP as investors digested weak business activity survey data from the bloc. MSCI's gauge of stocks across the globe EURONEXT:IACWI fell 0.39% to 842.18.

Asia-Pacific shares outside Japan (.MIAPJ0000PUS) had earlier shed 1.3% overnight, largely driven by Hong Kong stocks HSI sagging after a sizzling rally, with several markets, including mainland China and South Korea, closed for the day.

Japan's Nikkei NI225, however, ended up nearly 2% after the country's newly elected prime minister Shigeru Ishiba said it was not the time to raise interest rates after meeting with Bank of Japan Governor Kazuo Ueda.

Israel bombed Beirut early on Thursday following a year of clashes with Iran-backed Hezbollah. Asked if he would support Israel striking Iran's oil facilities, U.S. President Joe Biden told reporters on Thursday "we're discussing that." He added: "There is nothing going to happen today."

Brent crude futures BRN1! settled up 5.03% at $77.62 a barrel. U.S. West Texas Intermediate (WTI) crude futures CL1! settled up 5.15% to $73.71.

"The fact that energy is up where everything else is down pretty significantly is an indication that today's move is a lot about the escalating conflict in the Middle East," said James St. Aubin, chief investment officer at Ocean Park Asset Management in Santa Monica, California.

"There's probably some trepidation or maybe some hesitation about putting money to work ahead of tomorrow's jobs report."

Gold prices were flat as the U.S. dollar strengthened against major currencies. Spot gold GOLD fell 0.01% to $2,657.24 an ounce, while U.S. gold futures GOLD settled 0.4% higher at $2,679.2.

In currencies, the U.S. dollar index DXY rose to a six-week high, reaching 102.09, the highest since Aug. 19. It last rose 0.33% to 101.98. The euro was slightly down at $1.1026 EURUSD, and not far from Wednesday's low of $1.10325, a level last seen on Sept. 12.Sterling GBPUSD

 weakened 1.1% to $1.3122 after Bank of England Governor Andrew Bailey told the Guardian newspaper that the central bank could become a "bit more aggressive" on rate cuts if inflation continued to ease. Against the Japanese yen USDJPY, the dollar strengthened 0.1% to 146.61.

Treasury yields rose after the jobless claims data and service sector report. Two-year Treasury yields (US2YT=RR) were last up at 3.7095% on Thursday, while benchmark 10-year yields US10Y were last up at 3.853%.

Markets imply a 35% chance the Fed will cut interest rates by another 50 basis points in November, compared with almost 60% last week, and have around 70 basis points of easing priced in by year-end. 

"There are some uncertainties as it relates to the U.S. election and in our near term there's some volatility as it relates to the Middle East and what's happening there," said Arun Daniel, portfolio manager at American Century Investments. "People are cautious. But from a long-term perspective, we're positive."