NEW YORK, New York - World stock markets closed a volatile session with deep regional divisions on Thursday, as investors grappled with an escalating military confrontation after President Trump significantly widened U.S. attacks on Iranian targets. The fresh geopolitical shock hammered technology shares on Wall Street and sent Japan's Nikkei plunging, while European and Asian benchmarks showed a starkly mixed performance.

On the presidential front, the White House confirmed that U.S. forces had conducted expanded airstrikes against Iranian military installations beyond the Persian Gulf, marking a sharp uptick in the administration's campaign against Tehran. Defense officials described the operations as "preemptive and necessary," but the move rattled global equity markets, driving capital into defensive pockets and punishing growth-oriented sectors.

On Wall Street, the Dow Jones Industrial Average closed at 52,552.97, shedding 105.67 points, a decline of 0.20 percent. The blue-chip index held up relatively well compared to its tech-heavy peers, but still finished near the session's lows as energy and defense gains were offset by broad-based selling.

The Standard and Poor's 500 ended the day at 7,533.77, falling 38.63 points or 0.51 percent. Trading volumes reached 3.031 billion shares as the benchmark tested intraday support between 7,504.02 and 7,570.74, with the index now sitting well above its 52-week low of 6,212.69 but trailing its high of 7,620.90.

The worst hit among U.S. indices was the tech-dominated NASDAQ Composite, which cratered by 387.28 points to close at 25,881.95, a steep loss of 1.47 percent on volume of 6.215 billion. Semiconductor and megacap growth stocks bore the brunt of the selling, as rising geopolitical risk prompted a swift rotation out of high-valuation names.

Across the Atlantic, European exchanges offered a more fragmented picture. London's FTSE 100 bucked the negative trend, advancing 56.32 points to finish at 10,572.24, a gain of 0.54 percent. The index was buoyed by heavyweight oil and mining stocks, which rallied on supply concerns stemming from the Middle East escalation. The FTSE traded between 10,447.55 and its session high of 10,572.24.

Germany's DAX P closed lower, falling 84.04 points to 24,915.49, a decline of 0.34 percent, after moving between 24,696.17 and 25,021.51 during the session. France's CAC 40 slipped a marginal 4.57 points to end at 8,377.86, down just 0.05 percent, while the pan-European EURO STOXX 50 I managed to post a gain of 18.03 points to 6,283.61, up 0.29 percent. The Euronext 100 Index also rose, adding 5.45 points or 0.28 percent to close at 1,920.53, while Belgium's BEL 20 eked out a 0.08 percent gain, finishing at 5,617.84 after gaining 4.33 points.

Asian markets closed earlier in the day with dramatic divergences. Hong Kong's HANG SENG INDEX surged 327.50 points to end at 25,008.60, a robust 1.33 percent advance, as Chinese state-backed buyers stepped in to stabilize sentiment despite the global geopolitical gloom. The index swung between 24,825.02 and 25,221.44.

On the mainland, China's SSE Composite Index tumbled 73.17 points to 3,882.41, a sharp drop of 1.85 percent on massive volume of 1.989 billion shares, as fears over global trade disruption outweighed domestic stimulus hopes.

The session's worst performer among major developed markets was Japan's Nikkei 225, which plunged 1,915.96 points to close at 66,835.54, a brutal decline of 2.79 percent. Export-oriented automakers and electronics giants bore the heaviest losses as the yen strengthened on safe-haven flows, compounding the damage from the widening Middle East conflic

Singapore's STI Index bucked the regional trend, dropping 20.34 points to 5,539.38, a loss of 0.37 percent, while Australia's S&P/ASX 200 closed virtually flat, down just 0.40 points or essentially 0.00 percent at 8,840.70. The broader ALL ORDINARIES inched up 2.30 points or 0.03 percent to finish at 9,036.90.

India's S&P BSE SENSEX was effectively unchanged, rising a nominal 1.47 points to 77,186.87, a gain of 0.00 percent, after touching an intraday high of 77,579.69. Indonesia's IDX COMPOSITE outperformed with a gain of 66.24 points to 6,108.21, up 1.10 percent, while Malaysia's FTSE Bursa KLCI advanced 8.43 points or 0.49 percent to 1,722.19.

New Zealand's S&P/NZX 50 slipped 20.32 points to 13,614.78, a decline of 0.15 percent, but the most dramatic move came from South Korea. The KOSPI Composite Index collapsed by 463.81 points to close at 6,820.60, a staggering loss of 6.37 percent on volume of 424,280 shares, as Seoul's heavy exposure to global tech supply chains and its proximity to the geopolitical flashpoint triggered a massive selloff. Taiwan's TWSE Capitalization Weighted Stock Index shed a marginal 6.62 points or 0.01 percent, ending at 45,624.98.

In the Americas, Canada's S&P/TSX Composite lost 76.05 points to 35,340.15, a decline of 0.21 percent on volume of 218.502 million shares, weighed down by broad risk-off sentiment despite strength in energy names.

Elsewhere, Israel's TA-125 fell 30.91 points to 4,096.58, down 0.75 percent, while Egypt's EGX 30 Price Return Index rose 369.70 points to 52,928.10, a gain of 0.70 percent on volume of 363.062 million, as local buyers shrugged off the regional turmoil. South Africa's Top 40 USD Net TRI Index declined 41.69 points or 0.62 percent to 6,674.86.

"Geopolitical risk has taken center stage, and the market is pricing in a significant escalation premium," said James Callahan, chief investment strategist at Paragon Wealth Management. "Tech is getting hit hardest because these are long-duration assets most sensitive to uncertainty and potential supply-chain shocks. The Nikkei's drop tells you everything about how global capital is rotating toward safety."

Traders now look to Friday's U.S. retail sales data for any reprieve, but with the president's military campaign showing no signs of de-escalation, volatility is expected to remain elevated through the end of the week.

U.S. Dollar Stages Robust Comeback, Erases Previous Session's Losses Across Major Peers

The U.S. dollar mounted a forceful recovery in global foreign exchange trading on Thursday, clawing back the widespread losses it suffered a day earlier as the greenback appreciated against every single one of its major counterparts.

After a midweek slump that saw traders pile into risk-sensitive currencies, the tide turned sharply on Thursday, as hostilities in the Gulf escalated, with the dollar index surging as Treasury yields steadied, and investors recalibrated their positions ahead of fresh domestic economic data.

The euro retreated against the resurgent dollar, with the EUR-USD pair slipping to 1.1438, a decline of 0.22 percent on the session. The single currency had briefly challenged the 1.1500 level on Wednesday but failed to hold those gains as dollar bids re-emerged in European afternoon trade.

Against the Japanese yen, the dollar strengthened notably, with USD-JPY climbing to 162.42, a gain of 0.14 percent. The pair continues to trade near multi-decade highs, keeping markets on alert for any verbal intervention from Japanese monetary authorities, though no such remarks materialized on Thursday.

Sterling suffered one of the day's sharper drops, with GBP-USD falling 0.51 percent to 1.3471. The pound had been buoyed earlier in the week by firmer-than-expected U.K. inflation data, but those tailwinds faded as the dollar's broad bid overpowered sterling's domestic support.

The Australian dollar, often seen as a barometer of global risk appetite, also gave back ground. The AUD-USD pair declined 0.16 percent to 0.6993, slipping back below the psychologically important 0.7000 handle as commodity prices softened and China's economic outlook remained under scrutiny.

In North American trade, the U.S. dollar advanced against its Canadian counterpart, with USD-CAD rising 0.06 percent to 1.4050. The move was modest but enough to extend the pair's recent range-bound pattern, as oil prices traded relatively flat, offering little directional impetus for the loonie.

The Swiss franc, a traditional safe-haven play, proved no exception to the dollar's strength. USD-CHF appreciated by 0.47 percent to 0.8091, marking one of the day's most pronounced moves as the greenback regained favor even against low-yielding defensive currencies.

"Today's price action is a classic snapback after yesterday's overshoot," said Maria Santos, senior FX strategist at Atlantic Capital Markets. "There was no single catalyst—rather, a realization that the dollar's selloff on Wednesday was overdone given the still-widening interest rate differentials and the resilience of U.S. economic fundamentals. The move higher was broad, clean, and across the board."

Traders now turn their attention to Friday's U.S. retail sales report and consumer sentiment data, which could either cement the dollar's recovery or reintroduce volatility if the figures surprise to the downside.

For now, however, the greenback has firmly reclaimed the upper hand, erasing the previous day's declines and reminding markets that its dominance remains far from broken.

(This report incorporates quotes retrieved with the assistance of artificial intelligence).

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