Crude oil prices surged 4 per cent on Monday after Iran launched multiple rounds of missiles toward Israel as a retaliation for the latter’s actions in Lebanon, putting the ceasefire in tatters. WTI and
Brent crude climbed above $93 and $96 per barrel, respectively, following the escalation of tensions in West Asia.
Meanwhile, the dollar index remained around 100 on Monday after climbing more than 1 per cent last week, supported by the robust US labour market.
The fresh escalation, along with a tech rout, has sent jitters across the global equity market. The Asian market fell as much as 8 per cent in the morning session on Monday.
South Korea’s Kospi remained the biggest laggard, falling 8 per cent to 7,442 before recovering to 7,568. Japan’s Nikkei 225 also slumped 3 per cent or 3000 points intraday to 63,649 amid the sharp selling in tech-related stocks.
Despite fresh escalation, US President Donald Trump said he believes Washington is on the verge of reaching a final agreement with Iran. He further warned Israel to retaliate following Tehran’s latest missile strikes, arguing that further escalation could jeopardise delicate negotiations.
According to Axios, Trump said he planned to personally call Israeli Prime Minister Benjamin Netanyahu and urge restraint after Iran launched missiles at Israel on Sunday, the first such attack since an April ceasefire took hold in the region.
US Market Bloodbath
US stock markets suffered a sharp selloff on Friday, wiping out nearly $2 trillion in market value as stronger-than-expected jobs data fueled fears that the Federal Reserve may keep interest rates higher for longer.
On Wall Street, all three major indexes ended lower, led by heavy selling in technology shares. The Dow Jones Industrial Average fell 1%, the S&P 500 lost 2.4%, while the Nasdaq Composite plunged 4%.
The so-called “Magnificent Seven” stocks, including Nvidia, Alphabet and Meta Platforms, all closed in the red. Broadcom tumbled nearly 7%, extending losses after the semiconductor giant reported underwhelming results earlier this week.
Data released on Friday showed that US employers added 172,000 jobs in May, significantly above economists’ expectations of 80,000.
The report reinforced the view that the US economy remains resilient despite higher borrowing costs and rising energy prices linked to the Middle East conflict.
