World markets experienced a decline on Friday, following Wall Street’s significant drop, which marked its worst performance since the onset of the ongoing Iran war. In early European trading, major indexes reflected the overall sentiment, with Britain’s FTSE 100 slipping 0.3% to 9,939.96, France’s CAC 40 decreasing by 0.7% to 7,718.97, and Germany’s DAX falling 1.3% to 22,314.28.
In Asia, the Tokyo Nikkei 225 ended 0.4% lower at 53,373.07, while South Korea’s Kospi mirrored this decline, also down 0.4% to 5,438.87. The Hang Seng in Hong Kong, however, showed a slight recovery, climbing 0.4% to 24,951.88 after an earlier dip. Shanghai’s Composite Index rose 0.6% to 3,913.72. On the other hand, Australia’s S&P/ASX 200 dipped 0.1% to 8,516.30, Taiwan’s Taiex fell by 0.7%, and India’s Sensex notably lost 2.1%.
The downturn in U.S. markets on Thursday saw the S&P 500 drop 1.7% to 6,477.16, marking its steepest decline since January. The Dow Jones Industrial Average decreased by 1% to 45,960.11, while the Nasdaq composite tumbled 2.4% to 21,408.08, bringing it 10% below its recent peak—an indication of correction.
Market turmoil has been exacerbated by uncertainty regarding the de-escalation of tensions between Washington and Tehran. Shortly after trading closed Thursday, U.S. President Donald Trump announced a delay on a planned strike against Iran’s energy facilities and extended the deadline for Iran to reopen the vital Strait of Hormuz, a crucial corridor for global oil and gas transport.
Despite the volatility, oil prices found support in early trading. Brent crude futures increased by 1.6% to $103.51 per barrel, and benchmark U.S. crude climbed by 1.7% to $96.12 per barrel. Analysts from ING Bank noted that the stability in oil prices followed Trump’s decision to postpone military action against Iran, although they cautioned that the potential for supply disruption remains significant.
Concerns escalated as Iran rejected a U.S. ceasefire proposal and proposed its own terms, coupled with the announcement of additional U.S. troops being deployed to the region. As the conflict enters its fourth week, there are fears that it could fuel global inflation and hamper economic growth worldwide amidst increasing energy costs and trade disruptions.
The situation in the Strait of Hormuz, which has faced significant restrictions since the war’s inception, continues to be contentious. Reports indicate that Iran is maintaining control over access to the strait, allegedly establishing a “toll booth” system for ships, with transactions being conducted in China’s yuan currency.
In commodities trading early Friday, gold and silver prices saw an uptick, with gold rising by 1.2% to $4,430.20 per ounce and silver climbing 1.7% to $69.08. Meanwhile, the U.S. dollar strengthened slightly against the Japanese yen, trading at 159.82 compared to 159.81, while the euro traded marginally lower at $1.1524, down from $1.1527.
