{"id":64937,"date":"2026-07-17T04:08:22","date_gmt":"2026-07-17T08:08:22","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-rattled-by-middle-east-escalation-and-historic-taiwan-tech-sell-off\/64937\/"},"modified":"2026-07-17T04:08:22","modified_gmt":"2026-07-17T08:08:22","slug":"global-markets-rattled-by-middle-east-escalation-and-historic-taiwan-tech-sell-off","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-rattled-by-middle-east-escalation-and-historic-taiwan-tech-sell-off\/64937\/","title":{"rendered":"Global Markets Rattled by Middle East Escalation and Historic Taiwan Tech Sell-Off"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>Taiwan\u2019s TAIEX index suffered a historic collapse, plunging 2,953 points (6.47%)<\/strong> as foreign investors sold a record <strong>$5.8 billion<\/strong> in shares amid an AI-driven tech rout.<\/li>\n<li><strong>BP (<a href=\"\/stock\/BP\">BP<\/a>) and ConocoPhillips (<a href=\"\/stock\/COP\">COP<\/a>) are launching multi-billion dollar investments in Iraq<\/strong>, a strategic move backed by the U.S. to erode Iran\u2019s energy dominance in the region.<\/li>\n<li><strong>Middle East tensions reached a boiling point<\/strong> as Bahrain intercepted Iranian aerial attacks, while the U.S. military (CENTCOM) confirmed the <strong>Strait of Hormuz remains open<\/strong> despite ongoing hostilities.<\/li>\n<li><strong>Volkswagen (<a href=\"\/stock\/VOW3\">VOW3<\/a>) faces a massive internal crisis<\/strong> with the Works Council warning that up to <strong>140,000 jobs are at risk<\/strong> as the automaker undergoes a radical restructuring.<\/li>\n<li><strong>Volvo Cars (<a href=\"\/stock\/VOLV-B\">VOLV-B<\/a>) reported high raw material costs<\/strong> across the board, specifically for lithium and nickel, while confirming it has <strong>no plans for further cash injections<\/strong> into its affiliate Polestar (<a href=\"\/stock\/PSNY\">PSNY<\/a>).<\/li>\n<\/ul>\n<h2>Middle East Conflict and Energy Realignments<\/h2>\n<p>The geopolitical landscape shifted dramatically on Friday as <strong>BP (<a href=\"\/stock\/BP\">BP<\/a>)<\/strong> and <strong>ConocoPhillips (<a href=\"\/stock\/COP\">COP<\/a>)<\/strong> committed to major infrastructure projects in <strong>Iraq<\/strong>. These investments, including a <strong>$25 billion deal<\/strong> for BP to boost northern oil and gas production, are part of a coordinated U.S. effort to decouple Iraq from its energy dependence on <strong>Iran<\/strong>.<\/p>\n<p>Simultaneously, the region remains on high alert following a series of direct military engagements. <strong>Bahrain<\/strong> reported intercepting and destroying several <strong>Iranian aerial attacks<\/strong> targeting military and civilian infrastructure. Despite the escalation, a spokesperson for <strong>U.S. Central Command (CENTCOM)<\/strong> told Al Jazeera that the <strong>Strait of Hormuz remains open<\/strong>, though commercial transits have reportedly slowed to a fraction of their normal volume.<\/p>\n<h2>Historic Sell-Off in Asian Markets<\/h2>\n<p>Taiwan\u2019s equity market experienced what analysts are calling the <strong>&quot;July 17 Massacre,&quot;<\/strong> with the <strong>TAIEX<\/strong> plummeting nearly <strong>6.5%<\/strong> in a single session. Foreign institutional investors offloaded a record <strong>$5.8 billion<\/strong> worth of shares, primarily targeting semiconductor giants like <strong>TSMC (<a href=\"\/stock\/2330\">2330<\/a>)<\/strong>. <em>Market sentiment has soured as investors question whether the massive capital expenditures in AI infrastructure will yield timely returns.<\/em><\/p>\n<p>In Japan, <strong>Prime Minister Sanae Takaichi<\/strong> emphasized that the <strong>Government Pension Investment Fund (GPIF)<\/strong>\u2014the world\u2019s largest pension fund\u2014investing in domestic assets is a &quot;key initiative.&quot; The government is also seeking a <strong>Diet extension until July 25<\/strong> to finalize critical economic policies as positive interest rates return to the Japanese market.<\/p>\n<h2>European Automotive Sector Under Pressure<\/h2>\n<p>The European auto industry is grappling with severe structural and inflationary headwinds. <strong>Volkswagen (<a href=\"\/stock\/VOW3\">VOW3<\/a>)<\/strong> is facing a &quot;major conflict&quot; with its <strong>Works Council<\/strong>, which warned that roughly <strong>140,000 jobs<\/strong> could be eliminated. CEO <strong>Oliver Blume<\/strong> is scheduled to hold extraordinary workers&#39; assemblies after the summer recess to address a <strong>20% cost disadvantage<\/strong> compared to global competitors.<\/p>\n<p><strong>Volvo Cars (<a href=\"\/stock\/VOLV-B\">VOLV-B<\/a>)<\/strong> CFO highlighted that raw material prices, particularly <strong>lithium, aluminum, and nickel<\/strong>, remain at elevated levels, squeezing margins. Furthermore, the company took a firm stance on its EV affiliate <strong>Polestar (<a href=\"\/stock\/PSNY\">PSNY<\/a>)<\/strong>, stating there are <strong>no plans for additional cash injections<\/strong>. This comes as Polestar faces a &quot;fire sale&quot; in the U.S. market due to new federal regulations on Chinese-linked vehicle software.<\/p>\n<h2>Aviation and Transport<\/h2>\n<p>In the aviation sector, <strong>Kepler Cheuvreux<\/strong> downgraded <strong>Air France-KLM (<a href=\"\/stock\/AF\">AF<\/a>)<\/strong> to &quot;Reduce&quot; from &quot;Hold.&quot; While the firm raised its price target to <strong>EUR 11.5<\/strong>, the downgrade reflects broader concerns over rising operating costs and regional instability affecting international travel routes.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways Taiwan\u2019s TAIEX index suffered a historic collapse, plunging 2,953 points (6.47%) as foreign investors sold a record $5.8 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