Middle East Conflict Fuels Market Turmoil as Oil Prices Surge

Stock markets plunged on Thursday, with the Nasdaq dropping over 2%, signaling a correction, as hopes for a swift end to the Middle East conflict faded. Oil prices climbed above $105 per barrel, sparked by uncertainty and the potential for prolonged geopolitical tension.

Investors fled to safe-haven assets, boosting the U.S. dollar while global debt markets witnessed a sell-off, leading to higher yields. The Nasdaq’s 2.4% drop from its peak on October 29 confirmed a continued correction as stock futures improved marginally following President Trump's temporary pause on planned attacks on Iran’s energy sector.

With investor confidence already shaken by energy supply concerns, Brent futures settled at $108.01, while the S&P 500 and Dow Jones also faced significant declines. As market volatility persisted, central banks worldwide, including Germany's, anticipated potential interest rate hikes, while the dollar's strength against major currencies underscored ongoing inflation fears.