Global markets begin second week in a row with universal crash as US-Israel war in Iran continues

U.S. stocks finished higher on Monday after a brutal start to the session, with investors rushing back in after President Donald Trump suggested the war with Iran may be close to ending.

The S&P 500 rose 0.83% to close at 6,795.99. The Dow Jones Industrial Average added 239.25 points, or 0.5%, to finish at 47,740.80. The Nasdaq Composite climbed 1.38% and ended at 22,695.95.

That was a sharp reversal from where things stood earlier in the day. At its lowest point, the Dow was down nearly 900 points. The S&P 500 and the Nasdaq had each fallen as much as 1.5% before turning around.

The shift came after Donald Trump told a CBS News reporter that “the war is very complete, pretty much.” The reporter later shared the comment in a post on X, and traders quickly treated it as a sign that the conflict might be nearing a close.

Oil swung just as wildly. West Texas Intermediate dropped as low as $81 a barrel after the comment. That came after WTI had ripped above $100 overnight and briefly traded above $119, the first time it had crossed that level since 2022, when markets were reacting to the fallout from Russia’s invasion of Ukraine.

Brent crude also backed off sharply, falling to around $84 a barrel at its session low. For perspective, U.S. crude had started the year below $60 a barrel, which shows just how violent the latest jump has been.

The rebound in stocks was also driven by a strong push higher in semiconductor names. Broadcom rose more than 4%. Micron Technology and Advanced Micro Devices each gained 5%, while Nvidia added more than 2%.

So by the closing bell, the mood had completely changed. What started as another fear-filled sell-off turned into a broad recovery in U.S. equities, helped by easing oil prices and a strong run in chip stocks.

The AI boom has run into a basic problem: the chips are improving faster than the buildings needed to power them. That is becoming a real pressure point for the trade, and it is also putting fresh attention on Oracle’s debt-heavy push into data centers.

At the center of it is OpenAI’s data center plan in Abilene, Texas, where the Stargate site has been a major focus. Bloomberg reported that OpenAI is no longer expected to grow that arrangement with Oracle there because it wants access to larger setups built around newer Nvidia chips.

The issue is timing. The Abilene facility is expected to run on Nvidia Blackwell processors, but the power for the site is still not expected to be available for about a year.

By that point, OpenAI is aiming to be using bigger clusters elsewhere that run on a later generation of Nvidia hardware.

That gets to the heart of the problem facing the whole sector. A company can line up land, construction, workers, financing, and hardware orders, then still end up chasing a target that has already moved. In AI infrastructure right now, waiting can make a brand-new site feel old before it is fully ready.

Oracle pushed back publicly after the report. In a post on X on Sunday, Oracle said reports around the activity were “false and incorrect.”

But the company’s statement focused on saying current projects were still moving ahead, and it did not directly say there would be a bigger expansion in Abilene.

That matters because Oracle had already gone in hard. The company locked down the site, committed to the equipment, and spent billions of dollars on construction and staffing with the expectation that the project would grow further.

Investors have already been punishing the stock. Oracle shares are down 23% this year and have lost more than half their value since the September peak.

The deeper worry is not just about one Texas site. It is whether the AI buildout is now moving so fast that even huge projects can fall behind before they are finished.

The Group of Seven is now moving from talk to crisis management after the war in Iran blew a hole in global energy flows.

Energy ministers from Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States are due to meet virtually on Tuesday morning to discuss whether they should tap emergency oil stockpiles.

That meeting follows talks on Monday between the bloc’s finance ministers, who discussed the same idea but stopped short of making a final call.

Reportedly, the tone inside those talks was constructive, and any joint step on reserves would likely come only after the energy ministers finish their own meeting.

The U.S. view is that a coordinated release in the range of 300 million to 400 million barrels would make sense. That would equal roughly a quarter to nearly a third of the 1.2 billion barrels held across the combined reserve system being discussed.

After Monday’s meeting, the finance ministers said they were prepared to act if needed, including by using stockpiles to help keep global energy supplies flowing. That statement came as governments tried to get ahead of a disruption that has already shaken markets worldwide.

The biggest problem is still the Strait of Hormuz, which remains shut because of threats from Iran. No one knows when shipping will start moving through the waterway again. That matters because roughly one-fifth of global oil consumption normally passes through that narrow corridor.

At one point, the supply panic pushed oil above $100 a barrel. Prices later eased on Monday as traders started betting that governments would step in with reserve barrels. U.S. crude was last near $95 a barrel, while Brent sat just below $100.

According to analysis from consulting firm Rapidan, the shutdown has caused the biggest oil supply disruption ever recorded.

The firm said this shock is harder to handle than past ones because the usual fallback producers are effectively boxed in. Saudi Arabia and the United Arab Emirates may have oil, but with Hormuz closed, they cannot fully get those barrels into the global market.

Rapidan’s analysts also said the U.S. Strategic Petroleum Reserve is not big enough on its own to replace all the oil now trapped inside the Persian Gulf.

The Department of Energy says the U.S. reserve currently holds 415 million barrels, which is about 58% of its total authorized capacity of 714 million barrels.

U.S. stocks opened the new week under pressure, with all three major indexes falling as investors kept reacting to the war in Iran and the latest jump in energy prices.

The Dow Jones Industrial Average dropped 719 points, or 1.5%. The S&P 500 fell 1.4%, and the Nasdaq Composite was down by the same 1.4%. The drop came after the Dow had already posted its worst weekly decline in nearly a year.

At the same time, Wall Street’s anxiety level shot higher. The Cboe Volatility Index, better known as the market’s fear gauge, climbed above 30 for the first time since the tariff-led sell-off in April 2025. That usually signals investors are rushing to buy protection in the options market.

Not every corner of the market was falling. Energy stocks moved higher in early Monday trading after oil prices pushed past $100 a barrel following production cuts from countries in the Middle East.

Among the gainers, Exxon Mobil and Chevron each rose nearly 1%. Valero Energy also gained nearly 1%. ConocoPhillips and Marathon Petroleum did even better, with both up more than 1%.

Defense stocks also advanced before the opening bell as the Iran war entered its 10th day. Shares of RTX, Northrop Grumman, and Lockheed Martin were each up around 1% at the time of reporting.

Their gains were also part of a broader run this month. RTX had climbed more than 3% month to date, Northrop Grumman was up more than 4%, and Lockheed Martin had added around 2%.

Smaller companies were under more pressure. The iShares Russell 2000 ETF was down nearly 2% in premarket trading, a sign that selling was hitting riskier parts of the market too.

South Korea’s Kospi led another brutal sell-off across Asia on Monday after it triggered its second circuit breaker in four sessions, as oil surged toward $120 a barrel for the first time since 2022.

The index fell more than 8%, forcing a 20-minute trading halt from 10:31 a.m. local time, and was last down 9%.

The oil shock kept getting worse. Brent crude jumped 26.1% to $116.08 a barrel, while West Texas Intermediate climbed 27.6% to $116.03. According to LSEG data, that was the biggest one-day gain in oil since late 1988.

In Japan, the Nikkei 225 tumbled 7.05%, dropping below the 52,000 level for the first time since January, while the Topix fell 5.36%.

Among the biggest losers, SoftBank dropped more than 11%. Chip stocks also got hammered, with Advantest down more than 13% and Lasertec off more than 11%.

Losses in China were smaller, but markets were still in the red. Hong Kong’s Hang Seng fell 2.75%, while mainland China’s CSI 300 lost 1.65%. In Australia, the S&P/ASX 200 fell 3.2%, though that was off its session lows.

The broader market board showed heavy losses across the region. Australia’s ASX 200 stood at 8,599.00, down 252.00 points or 2.85%. The Hang Seng was at 25,198.62, down 558.67 points or 2.17%.

The Kospi was at 5,138.08, down 446.79 points or 8.00%. Japan’s Nikkei stood at 52,303.22, down 3,317.62 points or 5.96%. India’s Nifty 50 was at 23,861.45, down 589.00 points or 2.41%. Shanghai was at 4,090.614, down 33.58 points or 0.81%.

In the metals market, bullion dropped as much as 3% to around $5,015 an ounce after posting its first weekly decline in more than a month, before cutting some of those losses.

By press time, spot gold was down 2.1% at $5,006 an ounce. Silver fell 1.9% to $82, platinum lost 2%, and palladium slipped by 1%. At the same time, the DXY Dollar Index rose 0.6% after climbing 1.3% last week.

The pressure was already spreading to Wall Street before the US cash session even began. Dow futures fell 1,026 points, or 2.33%. S&P 500 futures lost 2.05%, and Nasdaq 100 futures dropped 2.34%.

On Truth Social, Donald Trump said higher short-term oil prices were “a very small price to pay” for destroying Iran’s nuclear threat. He added: “Only fools would think differently!”