Global Markets Relatively Muted; Oil Price Rises on Escalating Middle East Conflict
Dow Jones Newswires
2025-06-23 16:13:00
By Dow Jones Newswires Staff
Oil and gas prices rose Monday after the U.S. struck the core of Iran's nuclear infrastructure over the weekend, marking a sharp escalation in the Middle East conflict.
Still, by early in the European trading session those gains, which helped lift the U.S. dollar, had moderated significantly. U.S. stock futures were pretty much flat and Treasury yields rose a touch.
- In early European trade, Brent crude and West Texas Intermediate were up 0.6% to $77.47 and $74.26 a barrel, respectively, having jumped around 3% earlier. The European benchmark gas contract at the Dutch TTF hub rose 1.4% to 41.50 euros a megawatt hour.
"Markets are still waiting to see what Iran will do next," analysts at Peak Trading Research said. "Hormuz is still open, trade is flowing, Iran's crude production facilities were untouched."
- The relative steadiness of prices signals that much of the "war premium" has been priced in, Phillip Nova's Priyanka Sachdeva said in a research note. For oil to keep marching higher, damage to supplies needs to be evident given that OPEC+ still holds a lot of spare capacity, she said.
- U.S. stock futures were trading in a narrow band either side of flat, reflecting the relatively sanguine response from stock markets globally to the weekend's strikes on Iranian nuclear facilities. Japan's Nikkei Stock Average closed down 0.1% having earlier lost around 0.2%, Hong Kong's Hang Seng climbed 0.5% and China's benchmark Shanghai Composite climbed 0.6%.
- There were modest falls across European stock markets at the open. The Stoxx Europe 600 declined 0.3%, although the Stoxx Europe 600 Oil & Gas Index rose 0.8%. The main stock markets in France and Germany fell 0.4% and the U.K.'s FTSE 100 lost 0.1%.
- The U.S. dollar rose, driven by the rise in oil prices. The DXY dollar index against a basket of major currencies was recently up 0.3% to 98.966, having reached a one-and-a-half-week high of 99.163 late Sunday.
- U.S. Treasury yields were up a touch; the 10-year Treasury yield rose 1.4 basis points to 4.388%, according to LSEG data.
- Bitcoin recovered slightly after hitting a six-week low on Sunday after the U.S. attacks, rising 2.2% to $101,768 after a low of $98,286 on Sunday, according to LSEG.
- Gold futures fell on the stronger dollar, easing 0.4% to $3,371.10 a troy ounce.
- Elsewhere, preliminary purchasing managers' surveys in the eurozone, U.K. and U.S. are in focus Monday, with French and German numbers already in and below forecasts. The Conference Board's consumer confidence survey for June lands Tuesday, and Friday brings the U.S. core personal consumption expenditures price index for May.
Write to Barcelona Editors at barcelonaeditors@dowjones.com
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