Middle East Conflict Escalates, Strait of Hormuz Shut

Global markets have been thrown into turmoil following strikes by the United States and Israel against Iran, which resulted in the death of Iran's supreme leader and subsequent retaliatory attacks across the Gulf. Crucially, Tehran effectively shut down the Strait of Hormuz, a vital waterway for global crude and LNG supplies, causing energy prices like West Texas Intermediate and Brent Crude to surge by almost 20 percent. This has led to a fresh spike in inflation concerns and dampened hopes for central bank interest rate reductions. Asian equities, particularly South Korea's KOSPI, experienced a significant rout, though some markets saw a rebound as traders bought the dip. South Korea's president activated a $68 billion stabilization fund to address the crisis. Shipping giant Maersk suspended bookings in the Gulf, highlighting the direct impact on global trade. The situation remains volatile, with analysts warning of continued uncertainty.