Global Markets Tumble as Trump Casts Doubt on Iran Ceasefire

Global stock markets fell and oil prices surged on Wednesday after US President Donald Trump cast doubt on the temporary truce in the Iran conflict, raising fears that renewed fighting could disrupt global energy supplies.

Wall Street opened lower after Trump suggested the ceasefire was effectively over, although he said talks with Iran could continue. "For me, I think it's over," Trump said about the ceasefire. "They can talk, but I think they're wasting their time." He later added that the United States was preparing for another night of strikes against Iran, further unsettling financial markets.

The S&P 500 fell 0.5 per cent, while the Dow Jones Industrial Average dropped about 550 points, or 1 per cent. The Nasdaq Composite was down 0.2 per cent.

Oil prices reacted more sharply. Brent crude rose 4.8 per cent to $77.74 a barrel after briefly crossing $79 earlier in the day. Although prices remain well below the highs seen earlier during the conflict, the latest jump reversed recent declines that had followed the ceasefire announcement.

Investors are concerned that renewed hostilities could disrupt shipping through the Strait of Hormuz, one of the world's most important oil transit routes. Any disruption could delay crude supplies, push up energy prices and fuel inflation worldwide.

Higher inflation could force central banks, including the US Federal Reserve, to keep interest rates higher for longer or even raise them further, increasing borrowing costs and slowing economic growth.

Companies that rely heavily on fuel came under pressure. Shares of American Airlines fell 3.4 per cent, while Norwegian Cruise Line Holdings declined 2.4 per cent.

Housing-related stocks also weakened as rising US Treasury yields raised concerns about higher mortgage rates. Builders FirstSource dropped 5.2 per cent, while homebuilders PulteGroup and DR Horton lost 3.8 per cent and 3.6 per cent, respectively.

Some technology stocks, however, limited broader market losses. Nvidia edged up 0.3 per cent, while Broadcom gained 4 per cent after Apple announced a multi-year agreement worth more than $30 billion to develop custom components with the chipmaker.

In the bond market, the yield on the benchmark 10-year US Treasury note rose to 4.58 per cent from 4.55 per cent a day earlier, reflecting growing concerns over inflation.

European markets also declined after Trump's remarks, with Germany's DAX index falling 1.6 per cent. In Asia, South Korea's Kospi index dropped 5.3 per cent, while Hong Kong's Hang Seng index rose 3 per cent.