13.06.2025 21:20
A significant downturn in US stock markets followed Friday's airstrikes launched by Israel into Iranian territory, prompting a retaliatory missile response from Iran. This escalating geopolitical conflict sent shockwaves through global markets, fueled by anxieties surrounding potential US military intervention. The incident unfolded rapidly, escalating from the confirmation of Iranian missile launches targeting Israel by the Israel Defense Forces late Friday. While videos circulated showing rockets aimed at Tel Aviv, the impact and interception details remain unconfirmed by Israeli authorities.
The market reacted swiftly and decisively to this news. A substantial decline impacted major indices; the Dow Jones Industrial Average plummeted by 769.83 points (a 1.8% decrease), the S&P 500 fell by 1.1%, and the Nasdaq Composite experienced a 1.3% drop. These losses not only erased the previous week's gains but also reversed the recent market rally driven by large-cap technology stocks.
The impact spread across the market. Nvidia, a key driver of the post-April market recovery, suffered significant losses as investors divested from high-growth assets, a common response to heightened geopolitical uncertainty. Conversely, the defense and oil sectors witnessed increased demand. ExxonMobil's stock price rose by 2%, while Lockheed Martin and RTX each saw gains of nearly 3% in after-hours trading. This shift in investor preference reflects a flight to safety and a bet on increased defense spending.
The heightened tensions, announced by Israeli Defense Minister Katz as a state of emergency following confirmation of the Israeli strike, drastically impacted commodity markets. Reports from NBC News, citing two unnamed US officials, clarified that the US was neither involved nor provided assistance in the Israeli operation. However, despite this official statement, speculation persisted. This fueled a rapid exodus from equities into commodities as traders sought refuge from the escalating risk. Oil prices surged dramatically, with Brent crude and West Texas Intermediate (WTI) futures experiencing increases of over 7%. WTI briefly approached $74 per barrel before a slight retreat. According to TD Securities commodity strategist Daniel Ghali, this price volatility mirrors similar responses to past military crises dating back to the 1980s, although historically, he noted, such geopolitical risks typically dissipate within a month.
