Stock Markets Around The World Reacted To Israel's Strike On Iran

Investors rushed to look for "safe harbors".

Stock markets in Asia collapsed Friday and Wall Street futures went down after Israel launched a military strike against Iran. Investors rushed to seek safe havens, buying gold and the Swiss franc.

The Reuters news agency reported.

Escalation in the Middle East, a key oil-producing region, has added fresh uncertainty amid an already strained global economy, exacerbated by U.S. President Donald Trump's aggressive and unstable trade policies.

Gold rose 1.5% to $3,434 an ounce, approaching the record $3,500.05 set in April.

Futures on the U.S. S&P 500 index fell 1.7%, the Nasdaq fell 1.8% and the pan-European STOXX 50 fell 1.6%. Japan's Nikkei was down 1.3%, South Korea's KOSPI was down 1.1% and Hong Kong's Hang Seng was down 0.8%.

Israel declared a state of emergency, expecting a missile and drone response from Iran. It had earlier announced a "pre-emptive strike" as part of the fight against Iran's nuclear program.

Iranian state media confirmed that the strike killed Islamic Revolutionary Guard Corps commander Hossein Salami. An Israeli defense official said Iran's chief of staff and several top nuclear scientists were also likely among the dead.

U.S. Secretary of State Marco Rubio called Israel's actions "unilateral" and said Washington had nothing to do with it.

Amid the search for safe assets, prices of U.S. government bonds rose, with the yield on 10-year securities falling to a one-month low of 4.31%.

The Swiss franc rose 0.4% to 0.8072 per U.S. dollar, while the Japanese yen rose 0.3% to 143.12. The dollar itself also acted as a safe haven, with its index up 0.5% to 98.131.

The euro slid 0.4% to $1.1538, partly rebounding from a 0.9% gain the day before to its highest since October 2021. The British pound slid 0.5% to $1.3554, after earlier in the day hitting its highest level since February 2022 at $1.3613.

"While we wait for further news and a potential Iranian response, we are likely to see further deterioration in market sentiment as traders close risky positions ahead of the weekend," said IG analyst Tony Sycamore.

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