Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

GLOBAL MARKETS-Oil, safe havens surge as U.S. strikes kill Iranian commander

Stock MarketsJan 05, 2020 05:32
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. GLOBAL MARKETS-Oil, safe havens surge as U.S. strikes kill Iranian commander

(Adds U.S. market open, byline, adds dateline; previous LONDON)
* Oil gains $3 a barrel after U.S. attack kills Iranian
* Scramble for safety boosts yen, Swiss franc, Bunds, gold
* European, U.S. shares fall less than 1%

By Herbert Lash and Marc Jones
NEW YORK/LONDON, Jan 3 (Reuters) - Oil prices surged as much
as $3 a barrel as gold, the yen and safe-haven bonds all rallied
on Friday after the U.S. killing of Iran's top military
commander in an air strike in Iraq ratcheted up tensions between
Washington and Tehran.
Traders were spooked after the death of Major General Qassem
Soleimani, head of the elite Quds Force who was also one of
Iran's most influential figures, and by Iranian Supreme Leader
Ayatollah Ali Khamenei's vow of revenge.
Mideast-focused oil markets saw the most dramatic moves,
with Brent oil futures leaping as much 4.5% to $69.20 a barrel.
That was the highest since the attacks on Saudi crude facilities
in September, though the impact hit almost every asset class.
Europe's broad STOXX 600 index .STOXX fell as much as 1%
and shares on Wall Street almost the same as New Year optimism,
which had pushed equity markets to new records, evaporated.
The yen JPY= rose half a percent against the dollar to a
two-month high, the Swiss franc EURCHF= hit its highest
against the euro since September and gold prices XAU= climbed
to a four-month peak, racing past the key $1,550 an ounce level.

"Geopolitics has come back to the table, and this is
something that could have major cross-asset implications," said
Salman Ahmed, Lombard Odier's chief investment strategist.
"What is critical is how it pans out in the next few days,"
Ahmed said. "Whether it turns into a theme depends on Iran's
reaction and then the U.S. response."
Iran promised harsh revenge. Soleimani's Quds Force and its
paramilitary proxies, ranging from Lebanon's Hizbollah to the
PMF in Iraq, have ample means to mount a response. In September, U.S. officials blamed Iran for attacking the
oil installations of Saudi Aramco, the state energy giant and
the world's largest oil exporter. Iran has denied responsibility
for the strikes and accused Washington of war-mongering.
The Trump administration then did not respond, beyond heated
rhetoric and threats, and markets settled down within a week
after Brent surged 14.6%, its biggest one-day percentage gain
since at least 1988.
The U.S. government and others on Friday urged their
citizens in the region either to return home or to stay away
from potential targets and public gatherings. U.S. Secretary of State Mike Pompeo said in a round of TV
interviews that the United States remained committed to
de-escalation with Iran but that it had needed to defend itself.
"He (Soleimani) was actively plotting in the region to take
actions - a big action as he described it - that would have put
dozens if not hundreds of American lives at risk. We know it was
imminent," Pompeo told CNN.
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.43%, while its emerging markets index lost 0.32%.
On Wall Street, the Dow Jones Industrial Average .DJI fell
210.81 points, or 0.73%, to 28,657.99. The S&P 500 .SPX lost
18.86 points, or 0.58%, to 3,238.99 and the Nasdaq Composite
.IXIC dropped 58.26 points, or 0.64%, to 9,033.93.
The global gauge and Wall Street indices set record closing
highs on Thursday, extending the year-end rally in equities.
Brent LCOc1 hit a peak of $69.50 a barrel, its highest
since mid-September, though it later traded up $2.40 to $68.65.
West Texas Intermediate (WTI) crude CLc1 rose $2.20 to
$63.38 a barrel, after earlier spiking to $64.09 a barrel, its
highest since April 2019.

Yields on German Bunds and U.S. Treasuries - the world's
benchmark government bonds that are typically seen as the safest
assets - fell sharply.
The 10-year Bund DE10YT=RR yield fell 7 basis points to a
two-week low of -0.299%, while Bund futures FGBLc1 were up
0.51 percent, at 172.13 euros.
Benchmark 10-year Treasury notes US10YT=RR rose 23/32 in
price to yield 1.802%, from 1.882% late on Monday.
The dollar index .DXY fell 0.08%, with the euro EUR= up
0.06% to $1.1177. The Japanese yen JPY= strengthened 0.59%
versus the greenback at 107.94 per dollar.
The focus on geopolitics meant markets paid little attention
to stronger-than-expected data from France, where inflation rose
1.6% year-on-year in December, beating analysts' expectations
for a 1.4% rise.
German inflation figures were also higher, although
unemployment in Europe's largest economy rose more than
expected. The U.S. manufacturing sector contracted in December by the
most in more than a decade, with order volumes crashing to near
an 11-year low and factory employment falling for a fifth
straight month, the Institute for Supply Management said.
Investors also were looking forward to the minutes of the
U.S. Federal Reserve's Dec. 10-11 meeting due at 2 p.m. (1900

Geopolitical tensions rattle world markets

GLOBAL MARKETS-Oil, safe havens surge as U.S. strikes kill Iranian commander

Related Articles

Liberty Global Earnings Beat, Revenue Misses In Q2
Liberty Global Earnings Beat, Revenue Misses In Q2 By - Jul 30, 2021 - Liberty Global reported on Thursday second quarter earnings that beat analysts' forecasts and revenue that fell short of expectations. Liberty Global announced...

Amazon Earnings Beat But Revenue Outlook Falls Short
Amazon Earnings Beat But Revenue Outlook Falls Short By - Jul 30, 2021

By Yasin Ebrahim - Amazon (NASDAQ:AMZN) reported Thursday softer third-quarter revenue guidance and mixed second-quarter results as earnings beat, but revenue fell...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email