US-Iran Tensions Spark Global Market Sell-Off as Oil Prices Surge
US-Iran tensions sent shockwaves through global markets on Monday as oil prices surged following renewed military strikes between the two countries. The Dow Jones Industrial Average plummeted over 300 points, while the S&P 500 and Nasdaq Composite traded lower.
Brent crude prices rose nearly 5% to $90.38 a barrel, with West Texas Intermediate crude futures increasing by 2.28% to $85.30 a barrel. The surge in energy costs added to inflation concerns, already exacerbated by Fed Chair Kevin Warsh's hawkish remarks at the Jackson Hole symposium.
Warsh signaled that the Federal Reserve may not be finished raising interest rates, pushing market expectations for a rate hike in September to 65.9%. This shift in expectations was reflected in the 10-year Treasury yield, which rose to 4.762%, its highest level since 2025.