Wells Fargo has reduced its target for the S&P 500 stock index, citing concerns that potential military conflict involving Iran could limit market gains. The investment bank's revised outlook reflects growing uncertainty about geopolitical risks in the Middle East and their potential impact on financial markets.

Meanwhile, European energy markets are showing signs of strain as the electricity price gap between Germany and France reached record levels amid concerns about Iranian conflict. The widening spread between the two major European economies' power prices highlights how geopolitical tensions are rippling through energy markets across the continent.

The developments come as markets globally are reassessing risk amid escalating tensions in the Middle East. Iran's strategic position in global energy markets makes any potential military action a significant concern for both equity and commodity markets.

Energy prices have been particularly sensitive to Middle Eastern geopolitical developments, given the region's central role in global oil and gas supply chains. The electricity price divergence between Germany and France reflects different energy dependencies and supply vulnerabilities between the two European Union partners.