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Bloomberg
a day ago
- Business
- Bloomberg
Iran Attack Ratchets Up Geopolitical Risks for Traders
Israel's sweeping attack on Iran has sent a jolt through markets and again thrust geopolitical risk front and center for investors. The initial reaction was sharp, with oil prices briefly surging as much as 13%, but the moves cooled throughout the day. 'We are seeing classical risk-off moves,' said Matthew Haupt, portfolio manager at Wilson Asset Management. 'What we are watching now for is the speed and scale of the response from Tehran. That will shape the duration of the current moves. Quite often these moves fade after the initial shocks.' Here's a round up of more market reaction and analysis: From the US to Japan, governments are having to pay investors more to get them to lend money by buying bonds, and several countries are pulling back on issuing 50-, 70- and 100-year bonds just a few years after investors couldn't get enough of them. Bloomberg Originals looks at the end of the long bond era.
Irish Times
a day ago
- Business
- Irish Times
Stocks fall and oil prices hit three year high after Israel strikes Iran
Stocks fell along with equity-index futures and investors rushed to the safety of haven assets after Israel attacked Iran's nuclear program sites in a major escalation of tensions in the Middle East. Crude oil jumped 9 per cent, the biggest move in more than three years. Contracts for the S&P 500 index retreated 1.6 per cent, and a gauge of Asian stocks dropped 1.1 per cent. Treasuries advanced, with the 10-year yield falling one basis point to 4.34 per cent. Gold rose and cryptocurrencies tumbled. A gauge of the dollar rose 0.4 per cent after initially falling, buoyed by the shift to safer currencies even amid recent doubts about the reliability of dollar. The currency had hit a three-year low on Thursday. The airstrikes against Iran's nuclear program and ballistic-missile sites renewed a standoff between the two adversaries that risks spiralling into a wider conflict. READ MORE While the market reaction was strongest in crude oil, moves in other pockets of the market suggested that investors are watching how long the tensions will last and whether the situation escalates. 'We are seeing classical risk-off moves,' said Matthew Haupt, portfolio manager at Wilson Asset Management. 'What we are watching now for is the speed and scale of the response from Tehran. That will shape the duration of the current moves. Quite often these moves fade after the initial shocks.' Israel said the operation will continue for 'as many days' as it takes to remove the threat and Iran vowed to respond 'harshly.' The move came after repeated warnings by Israeli prime minister Benjamin Netanyahu about striking Iran and crippling its nuclear program. Iran had previously said it would inaugurate a new uranium-enrichment facility in response to censure by the UN atomic watchdog over its nuclear program. The oil futures curve strengthened on concerns that Israel's latest strike on Iran could have severe and long-lasting repercussions. The most obvious market impact was in oil as Iran is a major exporter of crude to countries such as China and India. Moves in other sectors were more measured as investors braced themselves for the possibility of a steeper selloff. 'This is very serious,' said US-based Kim Forrest, chief investment officer at Bokeh Capital Partners. 'It's surprising the market isn't down more. Do I expect things to get lower in the coming hours? Heck yeah I expect it to be lower by the time I wake up but it'll also depend who's talking and what's happening. US secretary of state Marco Rubio said the US is not involved in the air strikes and that Israel took unilateral action against Iran. The attack is coming at a time when global financial markets had recovered from a slump in April caused by Trump's tariffs. An index of global stocks touched a record Thursday, gaining more than 20 per cent from a low hit in April. The attack is 'poised to echo through global markets — not just as a geopolitical flashpoint, but more as a stark wake-up call,' said Hebe Chen, an analyst at Vantage Markets in Melbourne. 'Investors now have to face the mounting threat of multi-front tensions, where potential new hot wars and intensifying trade wars collide, reshaping risk sentiment in real time.' Separately, officials at the Bank of Japan see prices rising a little stronger than they expected earlier in the year, a factor that may open the door to discussions over whether to raise interest rates if global trade tensions ease, according to people familiar with the matter. The officials expect the central bank's benchmark interest rate to be left at 0.5 per cent at the end of a two-day gathering next week as they need to monitor developments in tariff talks globally and their economic implications, the people said. – Bloomberg
Arabian Post
a day ago
- Business
- Arabian Post
Market turmoil grips Asia after Israel strikes Iran
Arabian Post Staff -Dubai Stock markets across Asia plunged as global investors rushed to safe-haven assets following a military strike by Israel on Iran's nuclear and ballistic missile facilities, intensifying geopolitical tensions in the Middle East. U.S. equity futures dropped sharply, while commodity prices surged—fuelled by fears of supply disruption and escalating conflict. Crude oil futures reacted violently, with Brent surging about 9 % to approximately US $75.36 per barrel and West Texas Intermediate climbing to US $74.20, both marking the largest daily gains in months. Goldman strategists and energy analysts attributed the spike to risk premiums linked to potential retaliation and threats to regional infrastructure, especially across the Strait of Hormuz. ADVERTISEMENT Precious metals and defensive currencies were also swept up in the panic. Spot gold rose by around 1.5 % to trade near US $3,434 per ounce, inching closer to its April record peak of US $3,500. The Swiss franc strengthened by roughly 0.4 % to reach two‑month highs against the U.S. dollar, while the yen appreciated by about 0.3 %—classic indicators of risk-off sentiment. Asia's leading equity indices suffered notable losses: Tokyo's Nikkei 225 fell between 1.2 % and 1.4 %, Seoul's Kospi dropped about 1.1 %, and Hong Kong's Hang Seng declined roughly 0.8 %. U.S. S&P 500 E‑mini futures and Nasdaq futures plunged between 1.7 % and 1.8 %, while Pan‑European STOXX 50 futures slid around 1.6 %. In India, the Nifty 50 and Sensex tumbled approximately 1.2 %, with the oil and gas sector leading losses thanks to narrower refining margins and soaring crude prices. Stocks of Bharat Petroleum, Indian Oil Corporation and HPCL each shed between 3.5 % and 6 %. Airline stocks, already shaken by a recent Air India crash near Ahmedabad, declined further as travel costs and uncertainty weighed heavily. Debt markets saw a flight to quality. U.S. Treasury bonds rallied, pushing the 10‑year yield down to around 4.31–4.35 %, its lowest in a month. Currency markets mirrored these moves: the dollar index rose around 0.5 %, while the euro and sterling retreated slightly. Analysts suggested the next moves hinge on Iran's response. Charu Chanana, chief strategist at Saxo, noted that if tensions ignite, safe-haven demand and commodity volatility will likely persist. Matthew Haupt from Wilson Asset Management described this as a 'classical risk‑off move,' adding that duration and scale of Tehran's likely response will shape market impact. This episode compounds earlier market strains. The global economy already faces headwinds from volatile U.S. trade policy and high inflation, while negotiations over Iran's nuclear programme have stalled. A planned sixth round of talks in Oman was overshadowed as military actions overshadowed diplomacy. Market indicators suggest traders are swiftly reducing risk exposure ahead of the weekend. Tony Sycamore from IG forecast continued selling in equities, saying that prudent investors will likely trim positions until further clarity emerges. Energy market strategists warned of wider contagion. According to Saul Kavonic of MST Marquee, unless Iran specifically targets major oil infrastructure, supply impact remains limited—but persistent unrest could be enough to constrain output and flow through the region.
