The Iran-Israel conflict and equity markets are now in sharp focus. As direct strikes escalated in June 2025, global financial markets responded immediately.

Stock futures rebounded slightly early Monday as the spike in oil prices due to the escalating conflict between Israel and Iran eased for a moment. Stock gains were muted as investors remained concerned about the rising geopolitical risk to the global economy.

The Dow dropped more than 750 points Friday as investors fret over the risk of a widening war in the Middle East.

In other words, it seems like investors are nervous, but also they’re not panicking because something good could follow something scary. Namely, Israel neutered not just a foe that is developing nukes and threatening its destruction.

Relative calm returned to global markets, with stocks climbing and oil sinking alongside gold as fears subsided that Israel’s war against Iran would escalate into a wider conflict. News reports that Tehran wants to restart talks over its nuclear program also fueled risk-on sentiment.