Wall Street looked set for a deep red opening as US futures tracked a sharp sell-off across Asian markets, with investors turning risk-averse as the Iran war entered a critical phase and oil prices surged on fears of supply disruption.
Tracking global markets, US futures were trading lower, indicating a weak start for Wall Street. S&P 500 futures as of 3:47 p.m. were down 0.80% at $6,508.50, while Nasdaq 100 futures fell 0.76% to $23,916.50, reflecting growing nervousness among investors amid geopolitical uncertainty.
Indian markets mirrored the global risk-off sentiment. The BSE Sensex closed 2.46% lower, or 1,836 points, at 72,696.39, while the NSE Nifty 50 fell as much as 2.6% to 22,512.65. Intraday, the Nifty dropped 2.78% to 22,471.25 and the Sensex slipped 2.65% to 72,558.44, highlighting the intensity of the sell-off during the session.
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Asian Markets Crash
The weakness was even more pronounced across Asia. South Korea's Kospi tumbled 6.49%, while Japan's Nikkei 225 slid 3.48%. Hong Kong's Hang Seng dropped 3.54%, China's Shanghai Composite fell 3.63%, and Australia's ASX 200 eased 0.74%. Japan's broader Topix index also lost 3.4%, while South Korea's Kosdaq retreated nearly 5.56%. Trading in South Korea was temporarily halted after Kospi 200 futures plunged more than 5%, triggering circuit-breaker rules.
Asian equities have now declined for a third straight session and are nearing correction territory. Bond markets have also weakened as investors grow concerned that a prolonged conflict could push inflation higher, slow economic growth, and potentially force central banks to reconsider the path of interest rates.
European Markets Slump
European markets followed Asia lower at the open. The pan-European Stoxx 600 fell 1.6%, with all major sectors in negative territory. The UK's FTSE 100 dropped 1.4%, Germany's DAX declined 1.9%, France's CAC 40 fell 1.4%, and Italy's FTSE MIB slipped 1.6%, reflecting the broad-based global sell-off.
Oil prices rose sharply as markets assessed the risk of further escalation after the US issued an ultimatum to Tehran over reopening the Strait of Hormuz. Brent crude for May delivery rose 1% to $113.32 a barrel, reversing earlier losses, while WTI crude gained about 2.8% to $101.01 a barrel.
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Middle East Tensions
Monday marked the 24th day of the ongoing hostilities involving the US, Israel and Iran, with no signs of tensions easing. The conflict, which began on February 28, has continued to escalate despite US President Donald Trump stating last week that he was considering scaling back operations. So far, the fighting has claimed more than 2,000 lives, unsettled global markets, and triggered a sharp rise in oil prices.
Investors are now weighing sharply diverging outcomes from Trump's demand for Iran to reopen the Strait of Hormuz, with many viewing the current standoff as a potential turning point. Some investors are cutting exposure and raising cash amid fears of wider escalation across the Gulf, while others are positioning for volatility itself, expecting sharp market swings regardless of the eventual outcome.
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