The global markets are entering a phase of significant turmoil triggered by the widening conflict between the US-Israel alliance and Iran, which has generated an energy shock and renewed fears of stagflation. Financial instruments like stocks and bonds are simultaneously experiencing declines, rendering investors increasingly pessimistic about potential interest rate cuts. The European stock index, STOXX 600, lost 2.6%, marking its worst single-day performance since April, while the German DAX index fell 3%. The financial sectors, including banks and insurance companies, are hit hard, and even energy stocks are not serving as a safe haven due to a steep rise in oil prices indicating demand shock.