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Global markets roiled by political turmoil overseas

US Stock Futures Up As Markets Open For The WeekUS Stock Futures Up As Markets Open For The Week
Traders work on the floor of the New York Stock Exchange.Photo by Spencer Platt—Getty Images

Major stock indexes in the U.S. and Europe slid Thursday in the wake of political turmoil overseas, after a Malaysia Airlines passenger jet was hit by what U.S. intelligence agencies said was a surface-to-air missile.

The intelligence sources did not say whether the missile was fired by Ukrainian forces, or by rebels sympathetic to Russia.

Ukrainian officials said the plane, which was carrying 295 passengers, was shot down over a town in the east of the country, the Associated Press reported. Earlier, Malaysia Airlines said on its Twitter feed that it had “lost contact of MH17 from Amsterdam. The last known position was over Ukrainian airspace. More details to follow.”

News of the crash increased concerns over the ongoing political turmoil between Ukraine and Russia.

Additionally, Israel announced plans for its military to launch a ground offensive in the Gaza Strip after more than a week of fighting between the country and Hamas militants.

When markets closed at the end of a hectic day, the Dow Jones industrial average was down 161 points, closing below the 17,000 level a day after hitting a new record high. Other major U.S. stock indexes also pulled back, and the Chicago Board Options Exchange Volatility Index (VIX), which is sometimes called the “fear index,” soared more than 35%.

European markets also saw a sell-off, with the EURO Stoxx 50 falling 1.4% and the Deutsche Borse index dropping 1.1%. Gold prices jumped after news of the crash, giving the futures their largest gain in roughly a month.

The Russian ruble, already sliding due to the most recent economic sanctions placed on the country by the U.S., also continued to drop in value, falling farther than it has in three years. The currency’s exchange rate was down more than 1.7% compared to the U.S. dollar.

Speaking at a public event in Delaware Thursday, U.S. President Barack Obama said “the United States will offer any assistance we can” to the victims of the Malaysia Airlines crash.

U.S. stocks were already primed for a pullback. The S&P 500 has rallied 7.2 percent so far this year and has hit fresh record highs recently amid better-than-expected corporate earnings, central bank stimulus and signs that the U.S. economy is strengthening. The Dow Jones industrial average topped 17,000 for the first time ever earlier this month.