Financial Markets React to Middle East Tensions and U.S. Election Prospects

Global stock markets experienced a downturn amid rising tensions in the Middle East and increased speculation over Donald Trump's potential presidential election victory. Elevated uncertainty bolstered bitcoin and gold prices, while oil stabilized after supply concerns. Wall Street and European markets anticipate impactful earnings reports this week.

Global stocks started the week on a cautious note as last week's gains contrasted with heightening geopolitical tensions and speculation around the U.S. presidential election. The potential for Donald Trump's win uplifted bitcoin and gold to unprecedented peaks due to increased uncertainty over the Middle East conflict.

Security concerns in Beirut saw residents evacuate after Israel's planned strikes on Hezbollah-associated financial sites. This development stabilized oil prices amidst supply fears. Meanwhile, European markets await crucial earnings reports, including results from Germany's SAP, following a 0.6% drop in the STOXX 600 index.

U.S. markets will focus on major earnings updates, with Deutsche Bank, Barclays, Tesla, and IBM expected to report this week. The economic backdrop features busy activity later in the week, with attention on the Federal Reserve's Beige Book survey. The dollar's movement reflects better economic performance and potential federal actions.

(With inputs from agencies.)