Major Wall Street stock indices slumped sharply on Monday as investors braced for a protracted Middle East conflict. The downturn follows joint US-Israeli strikes on Iran that resulted in the death of its Supreme Leader, triggering a geopolitical crisis.
In retaliation, Tehran launched a barrage of missiles targeting Israel and American bases throughout the Gulf. This escalation threatens to paralyze global trade routes and reignite stifling inflationary pressures.
As of 9:35 am Eastern Time, the S&P 500 fell 0.8%. The Dow Jones Industrial Average was down 1% and the Nasdaq Composite was 0.7% lower.
At the opening bell, the Dow Jones Industrial Average fell 183.5 points, or 0.37%, to 48,794.42. The S&P 500 fell 54.5 points, or 0.79%, to 6,824.36, while the Nasdaq Composite dropped 346.1 points, or 1.53%, to 22,322.119.
Seeking stability amid the chaos, investors have pivoted toward traditional safe-haven assets, fueling a surge in gold, US Treasuries, and the dollar as the global economic outlook darkens.
While airline and travel stocks plunged amid widespread airspace closures, shares in defense contractors and petroleum producers surged sharply.
The Israeli military on Monday said it began a new “broad strike” on Tehran, while Gulf monarchies threatened to retaliate and tankers were attacked off Oman.
Following the West Asia turmoil, crude oil prices climbed about 8%.
In the bond market, the yield on the 10-year Treasury rose to 4.01% from 3.97% late on Friday.
The US dollar also appreciated against other major currencies, including the euro and Japanese yen.
