US Market Today: Dow Jones, S&P 500 and Nasdaq futures fall after US bombs Iran

U.S. stock futures fell and oil prices surged ahead of the Monday open on June 23, 2025, after surprise U.S. strikes on three Iranian nuclear sites. The escalation in Middle East tensions shook investor sentiment, with futures for the Dow Jones, S&P 500, and Nasdaq all pointing lower.

Brent crude rose over 2.4% to nearly $79 a barrel, and U.S. crude followed closely. The sharp move raised fresh concerns about inflation and economic stability. Markets are bracing for a tense start to the week as fears of a wider conflict in a key energy region grow. Let’s break down the Iran-Israel War, Impact of the recent US Strikes on Iran, and Strait of Hormuz’ importance.

Iran-Israel Conflict: What boiled over?

For years, Iran and Israel have been engaged in a "shadow war," with Iran supporting anti-Israel militant groups like Hezbollah and Hamas, and Israel allegedly conducting covert operations, including assassinations of Iranian nuclear scientists. The core of the dispute is Iran's nuclear program, which Tehran insists is for peaceful purposes, but which Israel and the U.S. view as an existential threat.

Tensions escalated dramatically after Israel began a direct military campaign against Iran's nuclear and military infrastructure on June 13, prompting retaliatory missile strikes from Iran. The U.S. entry into the open conflict, dubbed "Operation Midnight Hammer," marks a dangerous new phase. 

The U.S. carried out a major military strike over the weekend, called Midnight Hammer. B-2 stealth bombers from Missouri and submarines armed with Tomahawk missiles were used in an 18-hour mission. The U.S. says the operation hit targets inside Iran and "obliterated" its nuclear program. The US military action is a direct intervention in a long-simmering conflict between Israel and Iran.

US Market Reaction to Iran-Israel War Escalation

The first reaction from Wall Street to the weekend's geopolitical developments was unequivocally negative. As of early Monday, the sentiment was clear: investors are moving away from risk.

• Dow Jones Industrial Average: Futures fell by 126 points, or 0.3%.
• S&P 500: Futures for the benchmark index shed 0.26%.
• Nasdaq: Tech-heavy Nasdaq futures saw the steepest decline, losing 0.35%.

Source: CNBC

US’ attack at Iranian sites in Fordo, Isfahan, and Natanz, caught investors off guard. President Donald Trump had stated on Friday that a decision on a potential attack was expected "within the next two weeks," leading many to anticipate a period of diplomacy. The sudden military action has consequently shattered those expectations, fueling market anxiety.

The S&P 500 was already on shaky ground, having posted two consecutive weekly losses. Despite this, the index remained just 3% off a record high as of Friday's close, but the escalating conflict now poses a significant threat to that stability.

Oil prices jump after US bombs Iran

The most dramatic market movement was seen in energy prices. Oil, the lifeblood of the global economy, is highly sensitive to tensions in the Middle East, and the reaction was swift and sharp.

Source: Economic Times | Data as of Sunday evening/early Monday trading.

The surge is rooted in fears that the conflict could disrupt the flow of oil from the region.  Iran's parliament has approved a measure to close the Strait of Hormuz. However, a final decision will be taken by the Supreme National Security Council, Iran's top security authority. As the third-largest producer in OPEC, any impact on Iran’s output is significant.

Read more about How Israel-Iran War impacts US markets

What is The Strait of Hormuz?

The Strait of Hormuz is arguably the world's most critical maritime transit point for oil. It is a narrow but vitally important waterway that connects the Persian Gulf to the Gulf of Oman and the Arabian Sea. It lies between Iran and the Musandam Peninsula, part of Oman and the UAE. The Strait is about 167 km long and narrows to just 33 km at its tightest point, with 3 km-wide lanes for ships going in and out.

Key Statistics on the Strait of Hormuz:

• Global Oil Trade: More than 25% of the world's seaborne oil trade passed through the strait in 2024 and the first quarter of 2025.
• Daily Volume: An average of 20 million barrels of oil transited the strait daily in 2024.
• U.S. Imports: The U.S. imported approximately 500,000 barrels per day through the strait, accounting for about 7% of its total crude imports.
• Global Consumption: The oil flowing through this chokepoint represents about one-fifth of global oil and petroleum product consumption.

Source: U.S. Energy Information Administration, CBS News, CNN

Why is the Strait of Hormuz important?

Imagine The Strait of Hormuz is the main national highway connecting Mumbai's ports to all of northern India. If that single highway were to be blocked, the transport of essential goods would halt, causing shortages and a rapid increase in prices for everything from vegetables to electronics across the country. 

Similarly, blocking the Strait of Hormuz would choke off a massive portion of the world's oil supply. Its closure would have severe consequences for the global economy. In fact, economists warn that any disruption could push oil prices sharply higher, leading to increased fuel and transport costs. This may drive up inflation in the U.S. and worldwide. 

Even though the U.S. produces much of its own oil, global energy markets are closely linked, so no country would be fully immune from the impact.

US Stock Market Today: Investors fear uncertainty

U.S. stock futures rose and oil prices jumped after the attack, reflecting the market’s sensitivity to global tensions. Markets were already uneasy due to earlier trade policies under President Trump, making them more prone to shocks.

The sudden timing of the strikes, which didn’t match the President’s earlier statements, added to investor concerns. Confidence was shaken, and uncertainty grew. Investors are now watching for signs of a broader conflict and lasting energy price increases, both of which could hurt the economy.

When does the US market open in India time?

If you invest in US stocks from India, the US stock market opens at 7:00 PM IST and closes at 1:30 AM IST (next day), from Monday to Friday. These timings apply to both the New York Stock Exchange (NYSE) and the NASDAQ during Daylight Saving Time (March to early November). During Standard Time (November to March), the US market opens at 8:00 PM IST and closes at 2:30 AM IST.

Read More about US Stock Market Timings.

Source: CNBC, CNN, ET, EIA
Date: 23rd June 2025

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