Tensions between the United States and Iran escalated sharply as former President Donald Trump issued a 48-hour ultimatum for Iran to reopen the Strait of Hormuz, warning of airstrikes on Iranian power plants if compliance was not met. Tehran responded with a firm threat to fully close the strait and strike critical infrastructure in the US and Israel, including energy, IT, and desalination systems. The exchange intensified global market fears, triggering a broad sell-off across stock indices, government bonds, and gold prices.
The heightened diplomatic standoff coincided with increased military posturing and media coverage, fueling investor anxiety over regional instability. Financial markets reacted swiftly to the deteriorating situation, reflecting concerns about supply chain disruptions and potential oil price spikes. As rhetoric from both sides hardened, analysts emphasized the risks of unintended escalation. The developments underscored the fragility of geopolitical stability in the Middle East and its direct impact on global financial markets.