Markets are entering the week with heightened caution following a U.S. military strike on Iranian nuclear facilities. The attack has raised concerns over potential retaliation and wider regional instability, sending ripples through global financial markets. While initial reactions were mixed, investors remain on edge as they assess the geopolitical fallout.
Oil prices spiked briefly before stabilizing, prompting worries about inflationary pressure and energy supply disruptions. The possibility of Iran targeting key shipping routes has further fueled uncertainty in the energy sector. Traders are closely watching for any signs of escalation that could affect global supply chains or trigger broader conflict.
In this environment, safe-haven assets like the U.S. dollar and government bonds have seen increased demand. Equity markets, meanwhile, are showing signs of hesitation, with investors pulling back from riskier assets in favor of more defensive positions.
This week also brings important economic data, including consumer sentiment, home sales, and inflation indicators. These will offer further insight into the strength of the U.S. economy and influence expectations around interest rate policy.
For now, Wall Street remains in a wait-and-see mode—hoping for de-escalation, but preparing for potential turbulence if tensions intensify in the days ahead.
