Global markets tumble as Iran conflict intensifies and U.S. strikes loom
Stock indexes fell worldwide Tuesday amid escalating Iranian attacks and signals that American and Israeli strikes could continue for weeks, driving oil prices higher.
6 hrs ago
Global equity markets declined sharply Tuesday as Iran expanded retaliatory attacks around the Persian Gulf region while American and Israeli officials indicated that strikes on Iran could persist for weeks.
The MSCI World index contracted 0.88%, while European exchanges averaged losses around 4%. U.S. stock futures fell ahead of the opening bell, with Dow Jones contracts down 832 points, or 1.7%, S&P 500 futures declining 1.7%, and Nasdaq 100 futures dropping 2.2%.
In Spain, the Ibex 35 fell 4.5%, marking its largest decline since the tariff bombardment announced by Donald Trump 11 months ago. In Chile, the dollar approached the 900 peso threshold, reaching its highest level since January, as markets awaited the opening of the Santiago exchange.
Oil and gas prices surged amid the geopolitical tensions. Investors shifted toward safe-haven assets, particularly the dollar, to shield their holdings from the uncertain and unpredictable economic effects of the fighting.
Concerns centered on potential disruption to shipping through the Strait of Hormuz, the critical waterway on Iran's southern border through which a substantial portion of the world's oil and gas supply passes. Analysts at ING bank noted that a prolonged conflict would combine higher energy costs, disrupted logistics, and a generalized confidence shock, creating "a meaningful drag on global trade volumes at precisely the moment the world economy was still digesting the inflationary and growth consequences of the tariff shock," describing the timing as "the mother of all bad timings."
The sell-off reversed gains recorded Monday as investors reassessed the duration and scope of the regional conflict and its potential consequences for global economic growth and energy supplies.