As Conflict Continues, Stocks Fluctuate in Stagnant Trading.- Europe Market Wrap
Stocks varied as traders considered a variety of possible scenarios for the Middle East war, with oil prices remained high as violence continued following Trump’s call for discussions.
S&P 500 contracts fell 0.2% after fluctuating between gains and losses. European stocks fell 0.1 percent. Treasuries fell, with the two-year yield rising 2 bps to 3.88%. Brent crude remained above $100 per barrel. The Dollar rose 0.2%, while Gold climbed 0.3%.
According to Iran’s Fars news agency, US-Israeli attacks damaged a gas pressure-regulation plant and an administrative building in the central city of Isfahan. Fars also reported a strike on a pipeline providing gas to the Khorramshahr Combined Cycle Power Plant in southeastern Iran.
Traders are still juggling stories surrounding the US-Israeli assault on Iran, after Trump signalled a possible stop to hostilities on Monday following what he termed as productive talks. The good attitude generated by such words evaporated after Iran denied real talks, and the Wall Street Journal reported that US allies in the Persian Gulf may join the battle against Tehran.
Renewed tensions risk keeping oil prices high, perhaps fuelling inflation and strengthening expectations that officials will postpone or tighten monetary policy. Investors are concerned that the war will have long-term implications on economic growth and prices, even if hostilities cease shortly.
