Global markets faced a sharp downturn on Monday as renewed military clashes between the U.S. and Iran rattled investor confidence. Following Tehran's decision to close the strategic Strait of Hormuz and the subsequent announcement of a U.S. naval blockade, oil prices surged by over 4%, with Brent crude climbing toward $80 per barrel. This geopolitical instability has cast a shadow over Wall Street, where the Dow, S&P 500, and Nasdaq all traded in the red. The tech sector bore the brunt of the sell-off, particularly in semiconductors, as investor enthusiasm for AI-related stocks cooled significantly amid broader economic fears.

Beyond the stock market, the escalation of the conflict has pushed government bond yields higher, reflecting growing concerns over inflation and the potential trajectory of Federal Reserve interest rate policies. As Treasury yields climb toward multi-month highs, the U.S. dollar has strengthened against major currencies, including the yen and euro, while traders brace for upcoming inflation data. With global indexes also showing weakness—highlighted by a significant drop in South Korea’s KOSPI—investors are left navigating a period of heightened uncertainty, questioning how long this geopolitical friction will persist and what lasting impact it will have on the global economy.