Markets Reel as Israel-Iran Clash. Again.

By Elke Porter | WBN News Global | June 13, 2025
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JERUSALEM — A dramatic escalation between Israel and Iran erupted on Friday, sending shockwaves through global financial markets and stoking fears of a broader regional conflict that could disrupt the world’s energy supply.

Israel launched preemptive airstrikes targeting Iran’s nuclear facilities, including the Natanz enrichment site, and military infrastructure, killing senior commanders, though reports of the death of Major General Hossein Salami, head of Iran’s Revolutionary Guards, remain unconfirmed.

Iran retaliated with approximately 100 drones and ballistic missiles aimed at Israel, triggering air raid sirens in Tel Aviv and beyond. Israel’s defense systems intercepted most projectiles, reporting minimal damage.

The strikes, the most direct Israeli attack on Iran’s nuclear program to date, prompted widespread flight cancellations across Jordan, Israel, Iraq, and Iran, with Gulf airports also halting operations amid missile risks. The United States, a key Israeli ally, explicitly denied involvement, leaving the region on edge as analysts warned of a potential escalation cycle.

Financial Markets in Turmoil

Global markets reacted swiftly to the heightened tensions. The Dow Jones Industrial Average plummeted 860 points, or 2 percent, while the S&P 500 and Nasdaq Composite fell 0.9 percent and 1 percent, respectively. Futures had signaled the decline, with Dow futures dropping 423–478 points in premarket trading.Oil prices surged as investors grappled with the threat to the Middle East’s critical oil supply, which accounts for roughly a third of global production.

Brent crude futures jumped over 5–8 percent to above $74 per barrel, and West Texas Intermediate soared nearly 9 percent, crossing $74. The spike, the largest single-day gain in months, underscored fears of disruptions in the Strait of Hormuz, a vital oil transit chokepoint.

Safe-haven assets rallied amid the uncertainty. Gold prices climbed more than 1 percent to $3,405 per ounce, nearing record highs, as investors sought refuge. The U.S. dollar index rose 0.2–0.35 percent to around 98.03–98.15, and 10-year Treasury yields ticked up to 4.42–4.43 percent, reflecting concerns over rising borrowing costs and inflation fueled by higher oil prices.

Sector Shifts and Economic Fears

Defense stocks bucked the market downturn, with Lockheed Martin surging 3–4.64 percent, RTX climbing 3–5.02 percent, and Northrop Grumman gaining 1.77–4 percent. Technology stocks, however, faltered, with companies like Nvidia and Tesla declining as investors pivoted away from growth sectors.

The economic implications of a prolonged conflict are profound. Asian markets, including Japan and South Korea, and European shares dropped nearly 1 percent, reflecting concerns over energy security and trade disruptions. Economists, including Mohamed El-Erian, warned that the clash could deliver a “negative shock” to an already fragile global economy, exacerbating inflation and constraining monetary policy options.

“The Middle East’s role in global oil markets cannot be overstated,” said Sarah Khalid, an energy analyst at the Oxford Institute for Energy Studies. “A sustained conflict could send oil prices soaring further, hammering consumers and industries worldwide.”

A Volatile Path Ahead

As both nations signaled readiness for further action, the prospect of de-escalation appeared dim. Israeli officials described the strikes as a necessary response to Iran’s advancing nuclear ambitions, while Tehran vowed a “crushing response.” With Iran’s military capacity reportedly degraded, its ability to sustain a prolonged campaign remains uncertain, but the risk of miscalculation looms large.

For now, markets and policymakers brace for volatility. “This is a moment of high uncertainty,” said James Lerner, a geopolitical risk consultant. “The ripple effects—economic, political, and strategic—will be felt far beyond the region.”

#Israel Iran Conflict #Oil Price Surge #Gold Rally #Global Markets #Middle East Tensions #Safe Haven Assets #WBN News Global #Elke Porter

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