LONDON (Reuters) - Investors snapped up traditional safe-haven assets on Tuesday, sending gold briefly to a new record high, after the Israeli military said it carried out an attack on Hamas leadership in Qatar, marking an escalation of the conflict in the region.
The Japanese yen and Swiss franc held on to the day's gains, while the price of oil jumped by roughly $1 a barrel to just under $67.
COMMENTS:
MICHAEL BROWN, SENIOR RESEARCH STRATEGIST, PEPPERSTONE, LONDON:
"The immediate reaction of a spike
in crude benchmarks and some further upside in spot gold makes considerable sense."
"It seems unlikely that there will be any significant retaliation from the strikes, especially amid reporting that the U.S. gave their backing for them to take place, while Qatar's immediate response gives no indication that they are seeking to retaliate, or escalate tensions further."
"I'd expect the rally in crude to fade relatively rapidly, as we've tended to see with geopolitically-induced gains over the last few months, as focus the dust settles, calmer heads prevail, and focus returns to the fundamentals of an already-oversupplied market, into which OPEC+ are adding even more barrels from the start of next month."
CARLO FRANCHINI, HEAD OF INSTITUTIONAL CLIENTS, BANCA IFIGEST, MILAN:
"Targeting countries that are trying to mediate is far from ideal at this moment. Stock markets aren't reacting much, but gold is: it's at an all-time high. Things appear to be taking a turn for the worse.
(Reporting by EMEA Markets Team; Editing by Libby George)
