Monday's price drop means that this year's stock market rally in Stockholm has now been wiped out by a wide margin.
The stock market turmoil follows a surge in the world market price of crude oil and natural gas after the war that has broken out in the Middle East since the US and Israel attacked Iran on February 28.
Highest oil price since 2022
Among the heavyweights on the stock market, lockmaker Assa Abloy and ball bearing manufacturer SKF fell by 3.3 percent and 3.8 percent respectively. Defense group Saab, one of the year's price winners, went against the grain and rose 3.1 percent.
The price of Brent crude, a benchmark in the commodities market, peaked at around $119 per barrel overnight Monday and is hovering around $100 per barrel during afternoon trading - the highest price since 2022. The price of natural gas in Europe's commodities market is trending upwards.
Pricing in interest rate hikes
About a fifth of the world's oil and natural gas normally passes through the Strait of Hormuz in the Persian Gulf. But the war in the region has meant that shipping through the strait has virtually come to a halt for almost ten days - and major oil producers around the Persian Gulf have shut down production.
In the fixed income market, traders are starting to price in multiple rate hikes from central banks, which must limit the spread of the inflationary impulse coming from rapidly rising energy prices.
The krona is under pressure and is hovering around the rate of 9.20 kronor per dollar and 10.70 kronor per euro.
With Monday's decline of 1.7 percent, the OMXS index is down 0.6 percent since the turn of the year.
Corrected: An earlier version of the text listed the wrong country for the US and Israeli attacks.
