Middle East Strikes Push WTI Above $105, Stocks Slide

Iranian strikes on infrastructure in the United Arab Emirates pushed West Texas Intermediate crude above $105 a barrel on Monday and coincided with declines in global equity markets as investors shifted into safe-haven assets.

The attacks, the biggest escalation since a ceasefire on April 8, hit economic infrastructure in an emirate that serves as a regional commercial hub. The strikes raised concerns about potential disruptions to trade and investment in the Gulf.

Oil was the main driver of market flows. Traders priced higher energy risk after crude returned above $100, and demand rose for traditionally safer assets including the U.S. dollar.

Currency markets saw the dollar gain against most peers after an earlier pullback. Japanese authorities intervened briefly in the foreign-exchange market to counter the yen’s weakness, but the move did not produce lasting change in exchange-rate trends.

Global stock benchmarks fell, with larger drops recorded in markets east of the Atlantic. Traditional equities underperformed while higher-beta technology shares and cryptocurrencies showed relative resilience during the session. Metals retreated from last week’s highs and correlations across asset classes increased as institutional investors adjusted positions.

Traders flagged several economic events that could influence market direction this week. Australian purchasing managers’ indices precede a Reserve Bank of Australia policy decision. In the U.S., services-sector readings, ADP private employment figures and Friday’s monthly nonfarm payrolls report are scheduled and may affect views on inflation and central bank policy.

“Don't get too attached to one view because things are changing fast,” a market strategist cautioned, adding that the coming 24 hours would be an important test for currency markets and risk appetite.

Market participants said they would continue watching diplomatic talks and the calendar of economic releases for signs of either stabilization or further escalation that could affect oil, currency and equity prices.