US markets rose, shrugging off concerns over higher oil prices

New York/Hong Kong
CNN
—

The Israeli currency fell earlier in the week as oil prices rose and investors reacted War between Hamas and Israel.

Although Israel is not a major oil producer, Rising tensions The oil-rich Middle East spooked investors who had been selling oil in recent weeks.

Inflation, fears of a global economic downturn and a correction in rising prices in recent months have pushed U.S. oil prices above $80 a barrel from around $95 at the end of September.

But on Monday, US oil prices traded up 4% More, more than $86. Brent crude, the international benchmark, also rose nearly 4% to trade at nearly $88 a barrel.

Formally Israel declared war The Islamist militant group Hamas launched a deadly offensive on Saturday.

Officials say At least 900 people died in Israel More than 550 Palestinians were killed.

“While the Israeli government has warned of a long and difficult war, there are concerns that deeper and more sustained retaliatory attacks on Gaza could bring Iran into conflict and impact energy flows in the region,” said Susanna Streeter. Money and markets in Hargreaves Landsdown, written in a note.

On Monday, the Israeli shekel weakened Up to 3.92 For the US dollar, the worst 2016 onwards.

Israel’s central bank said it would sell $30 billion worth of foreign currencies to stabilize the currency and “provide liquidity necessary for the proper functioning of markets.”

In a statement, the Bank of Israel said it would provide an additional $15 billion in support if needed, saying it would “continue to monitor developments, monitor all markets and act with the necessary tools.”

U.S. stocks rose on Friday on surprisingly strong U.S Labor market reportIt rebounded on Monday afternoon after falling earlier in the trading session.

The Dow started lower, but was up 174 points, or 0.5%, on Monday afternoon. The S&P 500 rose 0.6% and the Nasdaq Composite rose 0.4%.

Stocks fell early Monday morning as global investors feared the conflict in Israel could spill over into the wider region, and lingering tensions in the Middle East could hurt a fragile global economic recovery. But the afternoon pullback suggests Wall Street is taking a wait-and-see approach for now to the risks that conflict in the Middle East could pose to financial markets.

“There are a lot of ‘maybes’ and ‘ifs’ right now — and real uncertainty,” said David Donabedian, chief investment officer at CIBC Private Wealth US, adding, “Markets will continue to see everything they usually see. In,” climbing bond yields and the Federal Reserve’s future monetary policy. including results.

European stocks also fell at the open Monday as traders digested the news, then steadied slightly, with France’s CAC 40 index down 0.6% and Germany’s DAX index down 0.7%. London’s FTSE 100 inched up 0.03%, led by gains in shares of oil companies.

In Asia, initial reaction among investors was mixed.

In mainland China, the Shanghai composite fell 0.4% after reopening following a holiday week. Meanwhile, Australia’s S&P/ASX 200 ended up 0.2%.

Hong Kong’s Hang Seng index rose 0.2% in early morning trading Suspension Because of the typhoon, markets in Japan and South Korea were closed for the holiday.

The key question for markets now is “whether the conflict is contained or spreads to include other regions, particularly Saudi Arabia,” analysts at ANZ wrote in a report on Monday.

“Initially, markets assume that the impact will be limited in scope, duration and oil price impact. But expect more volatility.”

— Robert North and Crystal Hur contributed to this report.