Stocks fall, oil spikes after Iran attacks Israel, Asia tumbles

Global markets sold off after Iran fired missiles at Israel, with investors moving quickly across U.S. futures, crude and Asian equities to price the risk that the Middle East conflict could drag on. Dow futures fell 80 points, or 0.2%, while S&P 500 and Nasdaq 100 futures each slipped 0.2%, a sign that traders were treating the attack as more than a one-night headline.

Asia took the sharpest early hit. South Korea’s Kospi plunged 8.4% and Japan’s Nikkei 225 dropped 3.4% in Monday trading as the region opened lower, underscoring how quickly geopolitical stress was feeding into equity valuations. The missile launch was the first such bombardment since a fragile ceasefire took effect in early April, and Iran’s state broadcaster confirmed the launch after explosions were heard in northern Israel.

Oil markets moved even faster. Brent crude jumped as much as 3.6% to $96.47 a barrel, while West Texas Intermediate rose near $94 before easing back. The move reflected fears that the fighting could widen beyond a single exchange, especially after renewed Israeli strikes on Lebanon pushed oil prices up by more than $2 a barrel and eroded hopes for a rapid de-escalation. The key pressure point is the Strait of Hormuz, where any threat to shipping would quickly turn a regional shock into a global energy problem.

The selloff landed on top of a weak finish to the previous week. The Nasdaq Composite fell 4.18% to 25,709.43 on Friday, its biggest drop since April 2025, while the S&P 500 lost 2.64% to 7,383.74 and the Dow fell 695 points to 50,866.78 after a stronger-than-expected May jobs report lifted Treasury yields and sharpened concerns about financing costs for AI-heavy companies. President Donald Trump has been pushing to preserve the ceasefire, but the renewed missile fire has made clear how fragile that effort is.

For now, markets are drawing a hard line between a contained flare-up and a broader selloff. If the exchange stops here and diplomacy reasserts itself, stocks and oil could stabilize quickly. If the strikes continue, or if the Strait of Hormuz comes under direct threat, investors are likely to keep pricing in higher crude, lower equities and a much longer period of disruption.