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Crude surges 14% on supply risks, gold just $56 from

record

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Wall Street futures slump 1.6%, European futures down 1.7%

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Iranian media confirms killing of Revolutionary Guards

chief

By Kevin Buckland

TOKYO, June 13 (Reuters) - Global stock markets dived on

Friday and oil prices surged after Israel conducted a military

strike on Iran, rattling investors and sparking a shift towards

safe havens such as gold and the Swiss franc.

The escalation in hostilities in the Middle East - a major

oil-producing region - adds a fresh layer of uncertainty for

financial markets at a time of heightened pressure on the global

economy from U.S. President Donald Trump's aggressive and

erratic trade policies.

Market reaction was swift. Crude oil jumped as much as 14%

at one point, with Brent futures up $5.43 at $74.79 per

barrel at 0541 GMT, and WTI futures up $5.55 at $73.59

per barrel. Gold climbed as high as $3,444.06 per ounce,

bringing it close to the record high of $3,500.05 from April.

U.S. S&P E-mini futures slumped 1.6% and Nasdaq

futures dropped 1.7%. Pan-European STOXX 50 futures

tumbled 1.7%.

Japan's Nikkei lost 1.1%, South Korea's KOSPI

dropped 1.3% and Hong Kong's Hang Seng declined

1%.

"The geopolitical escalation adds another layer of

uncertainty to already fragile sentiment," said Charu Chanana,

chief investment strategist at Saxo, adding that crude oil and

safe-haven assets will remain on an upward trajectory if

tensions continue to intensify.

Global stock markets had been poised for a fall following an

almost unbroken rally since early April that took the MSCI

All-Country World index to an all-time high this

week, according to Jessica Amir, a strategist at MooMoo.

"There's room for fat to be taken off the table," she said.

"It just appears that this is the catalyst that will

probably send equities down lower."

Israel said its "preemptive strike" targeted Iranian nuclear

facilities, ballistic missile factories and military commanders

to prevent Tehran from building an atomic weapon.

Iran had launched about 100 drones towards Israeli territory

in retaliation, which Israel is working to intercept, an Israeli

military spokesman said.

Iranian state media confirmed on Friday the death of Iran's

Revolutionary Guards Commander Hossein Salami in the strikes,

with six nuclear scientists also killed.

U.S. Secretary of State Marco Rubio called the Israeli

offensive a "unilateral action" and said that Washington was not

involved.

Tensions had been building as Trump's efforts to reach a

nuclear deal with Iran appear to be deadlocked. U.S. and Iranian

officials were scheduled to hold a sixth round of talks on

Tehran's escalating uranium enrichment programme in Oman on

Sunday.

The latest flare-up in fighting in the Middle East comes as

investors have been wrestling with major shifts in U.S. economic

and trade policies, as Trump has shredded the playbooks that

have governed international trade and the world order for

decades.

U.S. Treasuries were bought in the rush for safer assets,

sending the yield on 10-year notes to a one-month

low of 4.31%.

Some traders were attracted to the dollar as a haven, with

the dollar index up 0.6% to 98.277, retracing most of

Thursday's sizeable decline.

The Swiss franc was also in demand, but was flat

against the dollar at 0.8107. Fellow safe haven the yen

edged down 0.1% to 143.71 per dollar, giving up

earlier gains of 0.3%.

The euro sank 0.6% to $1.1521, retracing most of

its 0.9% overnight jump to the highest since October 2021.

Sterling skidded 0.6% to $1.3540, after marking a

fresh high since February 2022 at $1.3613 early in the day.

"Traders are now on edge over the prospects of a full-blown

Middle East conflict," said Matt Simpson, a senior market

analyst at City Index.

"That will keep uncertainty high and volatility elevated."