US equity markets closed sharply lower on Thursday as escalating geopolitical tensions in the Middle East triggered a broad-based risk-off selloff.
The Nasdaq Composite fell 2%, leading declines across major indices as investors retreated from growth and technology shares amid rising uncertainty.
The Nasdaq’s 2% drop underscores the sensitivity of high-multiple growth stocks to geopolitical shocks, even in the face of otherwise stable corporate earnings.
The move marks a significant shift in sentiment, with geopolitical risk premiums reasserting themselves over corporate fundamentals.
The selloff was driven by reports of renewed Houthi attacks and heightened rhetoric from US President Donald Trump regarding potential military action against Iran.
These developments have reignited fears of supply chain disruptions and broader regional conflict, prompting a rapid rotation out of risk assets.
The Nasdaq’s 2% drop underscores the sensitivity of high-multiple growth stocks to geopolitical shocks, even in the face of otherwise stable corporate earnings.