Stocks and Bonds Slide Globally as Oil Tops $100: Markets Wrap
(Bloomberg) — Stocks fell as the war in the Middle East sparked fresh turmoil in energy markets, sending oil above $100 a barrel for the first time since 2022. Bonds deepened losses while the dollar hit its highest level since January.
S&P 500 futures slid 1%. Brent soared 12% to $103 a barrel as Saudi Arabia became the latest Gulf producer to cut output, deepening fears of an inflation shock. The yield on 10-year Treasuries advanced four basis points to 4.17%. The dollar rose 0.3%. Gold fell below $5,100 an ounce.
The spike in oil and losses in bonds and equities were initially steeper, but news that Group of Seven finance ministers would discuss a possible joint release of oil from reserves trimmed the moves.
Still, the selling is adding fresh stress to markets as the US and Iran dug in for what could become a prolonged conflict. Iran’s new supreme leader, Mojtaba Khamenei, signaled Tehran won’t back down, while President Donald Trump said higher oil prices were a “very small price to pay” for safety.
“The selloff is all about oil, it’s about the inflation that is deduced from it, it’s about the risk of stagflation,” said David Kruk, head of trading at La Financiere de l’Echiquier in Paris. “The market is anticipating the worst-case scenario.”
Mining and airline stocks tumbled in premarket trading due to concerns over high energy prices and weaker economic growth. The Magnificent Seven tech heavyweights lost ground as well. Hims & Hers Health Inc. surged after Novo Nordisk A/S was said to agree to sell its weight-loss drugs on the Hims platform.
In Europe, a gauge of blue-chip stocks approached a 10% drop from its February peak. The region’s bonds faced a steeper selloff than US peers, with traders fully pricing in two European Central Bank interest-rate hikes and raising bets on a Bank of England move. The yield on two-year gilts jumped 24 basis points.
“Brent above $100 is a real risk for inflation and the economy,” said Andrea Gabellone, head of global equities at KBC Securities. “The EU economy is the most vulnerable with a double hit from the oil and gas price spike, and let’s not forget, another war closer to home.”
What Bloomberg strategists say…
“Everyone has become an oil-watcher now, and for the time being at least most other major asset prices are dependent variables, driven by developments in energy prices. In a very real sense, equities prices are oil prices, at least in the short run.”
— Cameron Crise, Macro Strategist, Markets Live. For the full analysis, click here.
Arab states across the Persian Gulf and Israel continued to face incoming missiles and drones from Iran, which said it had the capacity to sustain the war for months. Israel struck fuel depots in Tehran and threatened the Islamic Republic’s power grid.
Trump is also weighing the option of deploying special forces on the ground to seize Iran’s near-bomb-grade uranium, according to three diplomatic officials briefed on the matter.
The stock market’s reaction has so far been fairly restrained, with hopes lingering that strikes will remain contained in scope and time, said Wolf von Rotberg, equity strategist at Bank J Safra Sarasin.
“We have not yet seen markets capitulate,” von Rotberg said. “As oil infrastructure has been hit over the weekend, a prolonged rise in oil prices becomes more likely and a quick reversal of recent moves becomes increasingly difficult.”
Meltdown Odds
Veteran strategist Ed Yardeni has raised the probability of a market meltdown to 35% for the rest of the year, up from 20% previously, updating his outlook for what he describes as “fast-moving times.”
At the same time, he slashed the odds of a meltup — a rally driven more by investor enthusiasm than underlying fundamentals — to just 5% from 20%.
“The US economy and stock market are stuck between Iran and a hard place currently. So is the Fed,” Yardeni wrote in a note. “If the oil shock persists, the Fed’s dual mandate would be stuck between the increasing risk of higher inflation and rising unemployment.”
Some of the main moves in markets:
Stocks
S&P 500 futures fell 1% as of 7:56 a.m. New York time Nasdaq 100 futures fell 1.1% Futures on the Dow Jones Industrial Average fell 1.2% The Stoxx Europe 600 fell 1.6% The MSCI World Index fell 0.6% Currencies
The Bloomberg Dollar Spot Index rose 0.3% The euro fell 0.5% to $1.1559 The British pound fell 0.5% to $1.3347 The Japanese yen fell 0.4% to 158.48 per dollar Cryptocurrencies
Bitcoin rose 0.9% to $67,840.15 Ether rose 1.9% to $1,995.63 Bonds
The yield on 10-year Treasuries advanced three basis points to 4.17% Germany’s 10-year yield advanced three basis points to 2.89% Britain’s 10-year yield advanced 12 basis points to 4.74% Commodities
West Texas Intermediate crude rose 12% to $102.15 a barrel Spot gold fell 1.5% to $5,091.96 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Julien Ponthus.
©2026 Bloomberg L.P.
