Global markets recoiled Friday as Israel’s retaliatory strike on Iran sparked fears of escalating Middle East conflict, triggering a flight to safety.
U.S. futures plunged over 1%, while Brent crude oil surged 8% past $90/barrel and gold gained nearly 1%.
The rapid selloff reflects investor anxiety over potential disruptions to Middle Eastern oil supplies—Iran produces 3% of global output—and fresh inflationary pressures.
Nigel Green, CEO of deVere Group, cautioned against knee-jerk reactions: “This is a repricing of geopolitical risk, not a systemic crisis.” While acknowledging short-term volatility, he emphasized that market fundamentals remain intact, noting historical rebounds after initial geopolitical shocks. The immediate focus turns to central banks, as spiking energy prices complicate inflation fights—potentially delaying anticipated rate cuts.
Investors are advised to review portfolios for oil-sensitive exposures and consider defensive hedges like gold, but avoid panic selling. “These dislocations often create opportunities for disciplined investors,” Green added, stressing diversification amid uncertainty. With Tehran vowing retaliation, markets face prolonged turbulence, though analysts suggest the long-term impact may be contained unless supply disruptions materialize.
