Global Stocks Fall as Middle East Conflict Escalates

World stock markets continued to fall on Monday as the military conflict in the Middle East showed no signs of easing. The escalation of tensions following U.S. And Israeli attacks on Iran prompted a global sell-off in risk assets.

European Market Decline

European stocks clocked their biggest one-day decline in three months on Monday. The pan-European STOXX 600 closed down 1.7%, reaching its lowest level in more than two weeks, after hitting a record high on Friday CNBC. London’s FTSE index dropped 1.6%, while the Paris CAC lost 2.3% and the Frankfurt DAX was down 2.7%.

Dublin’s ISEQ index also closed lower, sinking 1.95% with shares in Ryanair down over 1.5%.

Wall Street and Asian Markets React

Wall Street’s main indexes were lower as investors braced for a prolonged Middle East conflict that threatened to disrupt global trade routes and reignite inflationary pressures CNN. The S&P 500 was down 1% with big banks such as Bank of America and Citigroup trading lower.

Earlier in Asian trade, Tokyo’s Nikkei index closed 1.3% lower as investors saw no clear end to U.S. And Israeli military strikes following the killing of Iran’s Supreme Leader, Ayatollah Ali Khamenei, while Hong Kong’s Hang Seng index dropped 2.1%.

Sector Performance

Sectors hit the most included airlines, as a number of carriers halted flights, while several oil and gas facilities in the Middle East stopped production, which pushed crude prices up over 8% Livemint.

US airline shares fell when markets opened on Monday, with American Airlines and United Airlines down more than 6%.

Investors flocked to traditional safe havens such as the dollar. Higher precious metals prices helped miners such as Kinross Gold and Harmony Gold add 1% each.

Defense stocks received a boost, with Lockheed Martin and RTX gaining over 3% each, while Kratos rose 9% and AeroVironment was up 19%.

Energy majors Shell, BP, and TotalEnergies all gained, following oil prices, which surged as much as 13% after shipping in the crucial Strait of Hormuz was disrupted by retaliatory Iranian attacks.

Oil Prices Surge

Global oil prices traded at their highest level in over eight months, with Brent crude surging 6% to $77.20 per barrel and West Texas Intermediate crude gaining 5.5% to $70.68 per barrel CNN. Oil prices had surged as much as 13% Sunday evening before paring gains.

Disclaimer: This article is based on information available as of March 2, 2026, and is subject to change as the situation evolves.