Turbulence in Global Markets Amid Middle East Conflicts
Futures tracking the Nasdaq and S&P 500 dropped over 1% as treasury yields surged due to Middle East conflicts sparking inflation fears. The rise in 10-year Treasury note yields and Brent crude prices added to concerns, with major U.S. equity indexes experiencing a downturn despite recent highs driven by AI-related gains.
On Friday, futures tied to the Nasdaq and S&P 500 plummeted, each losing over 1% in value, as surging Treasury yields stirred unease about growing inflation sparked by unrest in the Middle East. The 10-year Treasury note yields have climbed to 4.54%, marking a peak not seen since June 2025.
Investors globally have reacted to the escalating Iran conflict with increased bond yields, suggesting quicker-than-anticipated interest rate hikes that could stifle economic growth. The likelihood of the U.S. Federal Reserve raising rates by 25 basis points in December has more than doubled recently, according to data from CMEGroup's Fedwatch tool.
Compounding these market jitters, Brent crude prices soared nearly 3% to reach $109 a barrel amid a blockade of the Strait of Hormuz, igniting fears over worldwide energy supplies. Ipek Ozkardeskaya, a senior analyst at Swissquote Bank, emphasized the ongoing Middle East tensions as a critical concern overlooked by many tech investors.
(With inputs from agencies.)
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