Global Markets Reel Amid Escalating Mideast Tensions

Stocks plummeted and bond yields soared to multi-decade highs as investors bet on rate hikes amid escalating Middle East tensions. The conflict has sent oil prices surging, with crude jumping over two percent and breaching a 10 percent increase this week.

The United States' attack on an Iranian island in the Strait of Hormuz sparked a series of tit-for-tat attacks, targeting American interests in several regional countries. This move by Washington aims to economically strangle Iran, further exacerbating tensions in the region.

Bond yields have skyrocketed, with 30-year UK government bonds reaching their highest level since 1998 and 10-year debt hitting levels last seen during the global financial crisis of 2007-08. Japan's 10-year bond yield has also reached a 30-year high, while US 30-year Treasuries are just shy of their 2007 mark.

Market experts warn that these rising yields will put upward pressure on government borrowing costs and may hinder economic growth. Asian equities have taken a hit, with tech firms, reliant on low borrowing rates to fuel investments, leading the decline in Tokyo and Seoul.