Markets July 8: South Korean KOSPI Plummets 5% and Trading Halt, Brent Oil Surges Above $78 Due to US Strikes on Iran
Global markets have entered a phase of heightened volatility amid a sharp escalation of the situation in the Middle East. Reports of mutual strikes between the US and Iran, as well as risks of energy supply disruptions through the Hormuz Strait, have become the main drivers of market movements.
Global markets have entered a phase of heightened volatility amid a sharp escalation of the situation in the Middle East. Reports of mutual strikes between the US and Iran, as well as risks of energy supply disruptions through the Hormuz Strait, have become the main drivers of market movements. Investors are actively reducing positions in risky assets and shifting to defensive instruments.
US Futures Under Pressure, Europe Assesses Inflation Risks
US: American indices remain near historical highs, however, futures at the opening show a strong decline amid geopolitical risks. The S&P 500 is down 0.8%, while the tech-heavy Nasdaq-100 is down 1.2%. The Dow Jones index also shows a moderate decline. The main blow is taken by stocks in the technology sector, semiconductor manufacturers, and companies related to AI.
Europe: European markets are trading very cautiously. Investors are factoring in the risks of a new wave of inflation due to rising energy prices. Additional pressure on European indices comes from weak domestic industrial indicators and global trade risks.
Panic in South Korea: Trading Halt on the Exchange
Asian markets ended the day with polar results. The South Korean KOSPI became the main underperformer of the global session due to massive sell-offs of chipmakers. Shares of tech giants Samsung and SK Hynix plummeted, forcing the exchange to temporarily suspend trading due to critical volatility. At the same time, the Hong Kong Hang Seng managed to record growth.
US Strikes on Iran and Capital Flight to the Dollar
The main event of the day was the sharp escalation of relations between Washington and Tehran. According to media reports, the US launched a series of strikes on facilities in Iran following incidents with tankers in the Strait of Hormuz. Fears of a protracted conflict prompted investors to flee from risk. The dollar index (DXY) strengthened above the 101 mark, while the EUR/USD pair fell to the 1.14 level. Traditional safe-haven currencies — the Japanese yen and Swiss franc — are also in high demand.
Surge in Brent Prices and Correction of Digital Assets
Energy: The oil market has become the key beneficiary of the escalation. Brent quotes instantly soared above $78 per barrel, while American WTI also shows confident strengthening. Traders are factoring in risks of physical supply disruptions. Against this backdrop, European gas futures jumped more than 5%.
Gold: The precious metal is holding in a wide range of $4,115 – $4,150 per ounce. Despite the geopolitical status of the safe-haven instrument, some players are taking profits near historical peaks.
Cryptocurrencies: The high-risk digital sector is declining following the stocks of IT companies. Bitcoin has corrected to $63,140, while Ethereum is trading around $1,775. Sales have also affected shares of the largest mining pools.
Key Events of the Day (Almaty/Astana Time, GMT+5):
| 17:30 | US: EIA report on oil and petroleum product inventories (important amid escalation) |
| 20:00 | US: Treasury auction for 10-year bonds |
| 23:00 | US: Publication of the minutes from the June FOMC meeting (Fed minutes) |
Main Risks of the Day:
| — | Further uncontrolled escalation of the military conflict between the US and Iran. |
| — | Closure or blockade of shipping through the Strait of Hormuz. |
| — | Acceleration of inflation expectations due to oil prices being held above critical levels. |
| — | Acceleration of panic selling in the semiconductor and IT sectors of the global market. |
| — | Sharp jump in US government bond yields amid investors fleeing to cash. |
Summary: On July 8, markets are under full control of geopolitical factors. The situation in the Middle East has already triggered a surge in oil prices and a sharp increase in volatility. Investors remain focused on the evening Fed minutes, the dynamics of energy supplies, and the development of the military confrontation between the US and Iran, which directly affects the direction of financial markets in the upcoming trading sessions.