Global equities declined sharply on Monday amid escalating tensions with Iran, spiking the VIX and pushing crude oil prices higher. The S&P 500 dropped 1.8%, while the CBOE Volatility Index surged to 28.4, reflecting heightened risk aversion. Energy and defense stocks were hardest hit, with CL=F rising 5.2% and defense-related equities underperforming.
- S&P 500 dropped 1.8% to close at 5,342.31
- CL=F crude oil futures rose 5.2% to $89.40 per barrel
- ^VIX surged to 28.4, up 45% from prior close
- AAPL fell 2.4%, LMT and RTX dropped 3.7% and 4.1%
- 10-year U.S. Treasury yield rose to 4.38%
- Gold increased 1.6% to $2,080 per ounce
Global equity markets plunged Monday as fresh escalations in regional tensions involving Iran triggered a flight to safety. The S&P 500 fell 1.8% to close at 5,342.31, while the Nasdaq Composite dropped 2.1% amid broad-based losses. Apple Inc. (AAPL) shed 2.4% as investor sentiment soured on tech’s growth sensitivity to risk aversion. The surge in geopolitical anxiety was mirrored in energy markets, where crude oil futures (CL=F) climbed 5.2% to settle at $89.40 per barrel, reflecting concerns over potential disruptions to Middle East supply routes. The rally in oil coincided with a sharp spike in market volatility, with the CBOE Volatility Index (^VIX) jumping to 28.4 from 19.6 the previous day, marking its highest level since late 2024. The defense sector saw the most pronounced losses, with shares of Lockheed Martin (LMT) and Raytheon Technologies (RTX) falling 3.7% and 4.1%, respectively. Analysts noted that even without direct military conflict, the mere prospect of regional instability is boosting defense spending expectations and increasing scrutiny on energy infrastructure exposure. Investors are now reassessing risk allocations, with bond yields rising and safe-haven assets gaining traction. The 10-year U.S. Treasury yield climbed 12 basis points to 4.38%, while gold rose 1.6% to $2,080 per ounce. Market participants remain on high alert, with focus shifting to diplomatic developments and potential U.S. military posture adjustments in the coming days.