Middle East Tensions Spark Global Market Sell-Off as Inflation Concerns Linger

Global markets took a hit on Tuesday as tensions in the Middle East escalated. U.S. stocks plummeted, with the Dow Jones Industrial Average dropping 1.21% in the first hour of trading.

The Dow, S&P 500, and Nasdaq Composite all traded lower, with Brent crude oil spiking to $98.28 per barrel, its highest level in six weeks. The increase came after Yemen's Iranian-backed Houthis attacked energy facilities and cities in Saudi Arabia.

As inflation concerns persist, the European Central Bank is set to raise euro zone rates by a quarter point on Thursday, putting pressure on central banks to hike interest rates. The yen has surged as a result, with traders unwinding their carry trades, which involve borrowing yen to fund higher-yielding assets.