Middle East Tensions Spark Global Market Decline

Global markets declined on Monday due to renewed fighting in the Middle East, which lifted oil prices and increased investor concerns about inflation. This prompted traders to price in interest rate hikes from major central banks.

The surge in energy prices was fueled by a resumption of hostilities between the US and Iran in the region, raising fears of supply disruptions from key crude-producing areas.

Brent crude futures rose 2.2% to $92.48 per barrel, while West Texas Intermediate (WTI) crude gained 2.7% to $88.06.

Investors are also bracing for a slew of interest rate hikes from major central banks, including the European Central Bank (ECB), which is expected to hike rates by 25 basis points as early as next week, according to LSEG data.