On Friday, stock markets experienced a significant downturn, with the S&P 500 Index closing down 1.24%, the Dow Jones Industrial Average down 1.07%, and the Nasdaq 100 Index down 1.54%. This decline was driven by a broad selloff in global bond markets, amidst rising crude oil prices, which reached a 1.5-week high due to ongoing tensions in the Middle East, particularly the conflict with Iran.
Crude oil prices surged over 4% on Friday, and Goldman Sachs estimates that the disruption from this conflict has drawn down nearly 500 million barrels from global crude stockpiles, potentially reaching 1 billion barrels by June. Additionally, key economic data showed the May Empire manufacturing survey rose to a four-year high of 19.6, contributing to higher bond yields, with U.S. 10-year Treasury yields reaching 4.60%, the highest in nearly a year.
Overseas, European markets also fell sharply, with the Euro Stoxx 50 down 1.81%. Japanese and Chinese stock markets saw declines of 1.99% and 1.02% respectively. The volatility in global markets reflects ongoing concerns about inflation and potential central bank monetary tightening in response to rising energy prices.
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