Emerging-market stocks tumbled more than 10% from recent highs as Middle East tensions escalated, pushing oil prices sharply higher and triggering a broad risk-off sentiment. The selloff wiped out billions in market value across developing economies, with investors fleeing to the safety of the U.S. dollar. Most emerging-market currencies weakened against the greenback as geopolitical uncertainty rattled global markets.

Oil's surge added pressure on import-dependent economies already grappling with inflation concerns. The flight to safety intensified as investors reassessed exposure to regions vulnerable to supply chain disruptions and energy price shocks. Energy exporters saw mixed reactions - some benefiting from higher crude prices while others faced broader market contagion effects.

The market volatility underscores how quickly sentiment can shift when geopolitical risks flare. With oil prices climbing and currencies under pressure, emerging markets face a challenging environment where external shocks can quickly erase months of gains. The 10% drop marks a significant correction that could persist if tensions remain elevated and oil stays at elevated levels.