US sharemarkets declined on Monday, as escalating tensions in the Middle East pushed oil prices higher and renewed concerns about geopolitical instability. The Dow Jones Industrial Average fell 557.37 points, or 1.13%, to 48,941.90. The S&P 500 dropped 0.41% to 7,200.75, while the Nasdaq Composite eased 0.19% to 25,067.80.
The sell-off followed reports that the United Arab Emirates intercepted missiles fired from Iran, marking the first activation of its missile defence system since the U.S.-Iran ceasefire began last month. The developments added to uncertainty around the conflict and raised fears of further disruption to global energy supply.
Oil prices rose sharply amid the escalation. West Texas Intermediate crude gained 4.39% to settle at US$106.42 a barrel, while Brent crude climbed 5.8% to US$114.44.
Conflicting reports during the session added to volatility, including claims of an Iranian attack on a U.S. warship, which were later denied by U.S. Central Command. Donald Trump also outlined plans to assist cargo ships stranded by the Strait of Hormuz disruption, though details remain limited.
Despite the decline, markets remain near record levels following a strong earnings season and earlier optimism around a potential resolution to the conflict.
In corporate news, Amazon rose after unveiling expanded logistics services, while Atlassian extended recent gains. GameStop fell sharply following reports of a potential bid for eBay.
Australian Market Outlook
Australian shares are set to open lower, tracking weakness on Wall Street and rising energy prices. S&P/ASX 200 futures were down 70 points, or 0.8%, to 8,645.
Energy stocks are expected to outperform, while broader market sentiment remains cautious amid ongoing geopolitical uncertainty.
Locally, results are due from Westpac, Dexus and Vicinity Centres.
The key focus will be the Reserve Bank of Australia’s policy decision at 2:30pm AEST, alongside updated economic forecasts. Monthly household spending data is also scheduled for release at 11:30am.
