US-Iran tensions flared on news of a downed Apache helicopter that may not have actually happened, raising fears of a wider war that would be bad for markets and the region.

• Trump says Iran shot down a US Apache helicopter over the Strait of Hormuz and vowed to respond, though he claims both pilots are unhurt.
• The story looks shaky — the video being shared is old footage, and a drone like the one blamed could not realistically hit a moving helicopter.
• The suspicion is this is being used as an excuse for a US strike on Iran, with US refueling tankers reportedly already taking off from Israel.
• Markets had a wild day: stocks jumped on false hopes of an Iran deal, then suddenly dumped $1.3 trillion before the helicopter news even broke.
• There is no real deal in place — Iran wants frozen funds and sanctions relief upfront, and Trump has refused, so peace talks are far apart.

Outlook: A US or Israeli strike on Iran looks possible in the near term, which would likely reignite the war and rattle markets again.