Stocks retreated from record highs on Thursday after a fresh US military strike on Iran and Kuwaiti reports of missile attacks dented investor confidence in a peace deal.
Summary Stocks retreated from record highs on Thursday after a fresh US military strike on Iran and Kuwaiti reports of missile attacks dented investor confidence in a peace deal SYDNEY/LONDON – Stocks retreated from record highs on Thursday after a fresh US military strike on Iran and Kuwaiti reports of missile attacks dented investor confidence in a peace deal that many see as key to easing global inflation risks.
Oil rose as much as 4% and bond prices tumbled as the escalation muddied signals on peace talks, after US President Donald Trump dismissed an Iranian report of a deal to resume traffic through the Strait of Hormuz.
"Over the next two weeks, we expect either a deal for a new ceasefire, or the current ceasefire will have collapsed with active hostilities resuming," said Madison Cartwright, a senior geo-economics analyst at CBA. "Insurance through the strait has become prohibitively expensive and it's unclear how and at what price insurance will be made available," he added. "It is also not clear if Iran will charge a toll, or a toll by another name.
" The US military said it had carried out new strikes targeting an Iranian drone operation, while Tehran said it had attacked a US airbase in Kuwait. With transits through the strait still at a trickle, Brent crude was up 2.5% at $96.6 a barrel. The price has fallen back from four-year highs above $126 in late April, but remains 33% above pre-war levels and 50% higher than a year ago.
Yields on 10-year Treasury notes were up 1.7 basis points at 4.5%, as sustained high oil prices kept upward pressure on inflation expectations. Euro zone yields also rose, with Germany's 10-year Bund up 1.5 bps at 3%.indexes to new record highs. Europe's STOXX 600 was down 0.6% in morning trading, just below February's all-time peak, while US stock futures, were down 0.1% to 0.2%.
Attention now turns to US personal consumption expenditures data, which includes the Federal Reserve’s preferred inflation measure. Higher fuel costs are expected to lift the headline PCE to a three-year high of 3.8%, while core inflation is seen rising 0.3% to an annual 3.3%, well above the Fed's 2% target.to call for dropping its easing bias, or even preparing for a rate hike.
The shift in Fed expectations has supported the dollar, which held at 99.506 against a basket of currencies, steady on the week.
"I know there's an awful lot of dollar bears out there, and they have been for a while. But there's always acontrarian story here. And it could just be that the dollar has a bit of a resurgence now," Trade Nation market strategist David Morrison said.
The dollar hovered near a four-week high against the yen at 159.5, just below the 160 level that has previously triggered Japanese intervention.is on track for a 1.1% monthly fall, though expectations of a June European Central Bank rate hike offer some support. ECB Chief Economist Philip Lane said on Thursday policymakers must prevent the jump in energy costs feeding into broader inflation expectations.
In commodities, gold slid 1.5% to $4,390 an ounce, pressured by a stronger dollar and higher bond yields, which reduce its appeal as a safe haven.
Stock Market US Military Strike Iran Peace Deal Oil Prices
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Iran’s supreme leader warns US will no longer have ‘save haven’ bases in Gulf after new strikes on Tehran.Iran warned Gulf countries and the US after fresh military tensions in the region. Talks between countries continue to secure wider conflict.
Read more »
Iran accuses US of violating ceasefire, warns of responseIran says US strikes in Hormozgan violated the ceasefire and warns Tehran will respond to aggression.
Read more »
Iran Claims Enemy Has Turned to Hybrid Warfare After Failing on Military Front, Says Intelligence Ministryدشمن اقتصادی دباؤ، سائبر حملوں اور میڈیا پروپیگنڈے جیسے ہتھکنڈوں کے ذریعے نشانہ بنانے کی کوشش کر رہا، ایرانی حکام
Read more »
ٹرمپ کی عمان کو دھمکی پر ایران بھڑک اٹھا، بڑا بیان سامنے آگیاIran Condemns US Threats Against Oman Over Strait of Hormuz
Read more »
ایران پر نئے امریکی حملوں کے بعد تیل کی قیمتوں میں دوبارہ اضافہOil Prices Surge After Fresh US Strikes on Iran
Read more »