Geopolitical Tensions: Iran Strike Impact on Global Markets

What happened: Geopolitical tensions escalated as Iran expanded strikes on Gulf energy sites, driving oil prices to multi-year highs. Brent crude hit $112 on May 11, up 4.27% from the previous day. Meanwhile, gold prices dipped following Trump's rejection of Iran's peace plan, with June futures opening at $4,690 per troy ounce, down 0.9%. The conflict also impacted global markets, with the DAX down sharply on May 11 due to failed U.S.-Iran peace talks.

Market impact: The energy sector saw significant gains due to supply disruptions, with oil prices surging. Conversely, gold prices fell as the U.S. showed no signs of easing tensions. The broader market experienced volatility, with the S&P 500 dropping around 8% between February 28 and March 30 due to the Iran war. European markets, like the DAX, also felt the impact, with oil prices climbing and bond yields rising.

What to watch next: Investors should monitor U.S.-Iran relations, with key catalysts including Trump's 8pm ET deadlines and potential retaliation from Iran. The upcoming OPEC+ meeting on June 2 will also be crucial, as it may address production cuts and help stabilize oil prices. Additionally, watch for any changes in Indian fuel consumption and gold purchases, as Prime Minister Modi urged citizens to curb usage due to the conflict's economic impact.