The war in Iran is casting a long shadow over global financial markets, triggering a broad sell-off in stocks, bonds, and precious metals. The conflict, which began in late February, has led to surging oil prices and growing concerns about persistent inflation, prompting investors to reassess their strategies.
Stocks have been particularly vulnerable, with major U. S. indices like the S&P 500 and Nasdaq Composite registering their lowest levels in months. The Dow Jones Industrial Average has also taken a hit, reflecting widespread investor anxiety. The Russell 2000, an index of smaller companies, has entered correction territory, signaling a deeper pullback in riskier assets. The S&P 500 suffered its fourth straight weekly decline, its longest streak of weekly losses since February 2025. International markets, which outperformed the U. S. in 2025, have also tumbled since the start of the war.
Bonds, typically seen as a safe haven during turbulent times, are also under pressure. Treasury yields have been climbing as investors anticipate that the Federal Reserve may delay or even reverse course on interest rate cuts to combat inflation. The 10-year Treasury yield, a benchmark for mortgage rates, has reached its highest level since July, further dampening the outlook for economic growth.
Even gold, traditionally a go-to asset in times of crisis, has bucked the trend, experiencing its worst week in several years. Spot gold was down more than 8% in the past week, its worst weekly drop since early-2020. Rising oil prices and a strengthening U. S. dollar have diminished gold's appeal as a safe haven. According to Bloomberg, gold has posted losses for six straight days. This decline echoes a similar downturn in 2022 when the Russia-Ukraine war caused an energy shock that rippled through global markets.
