Stocks tumble, dollar up as Middle East war lights safe-haven trade
In Europe, stocks fell for a third day, leaving the STOXX 600 down nearly 2.5% on the week. (AFP pic)
TOKYO : Global stocks fell and the US dollar rose today, reflecting investors' preference for perceived safe-havens as concernsmounted over possible US involvement in the Israel-Iran air war, which has ignited a rally in the oil price this week.
On the geopolitical front, President Donald Trump kept the world guessing about whether the US would join Israel's bombardment of Iranian nuclear sites, telling reporters outside the White House today; 'I may do it. I may not do it'.
A flurry of central bank decisions in Europe highlighted how Trump's erratic approach to trade and tariffs has complicated the job of central bankers in setting monetary policy.
In Europe, stocks fell for a third day, leaving the STOXX 600 down nearly 2.5% on the week, set for its biggest week-on-week decline since the tariff-induced turmoil of April.
US S&P 500 futures fell 0.5%, although most US markets – including Wall Street and the Treasury market – will be closed today for a public holiday.
'Market participants remain edgy and uncertain,' said Kyle Rodda, senior financial markets analyst at capital.com.
Speculation was rife 'that the US will intervene, something that would mark a material escalation and could invite direct retaliation against the US by Iran,' he added.
'Such a scenario would raise the risk of a greater regional conflict, with implications for global energy supply and probably economic growth,' Rodda said.
Much of the recent nervousness in markets has been centred around crude supply shocks from the Middle East, which has driven the price of crude oil up by 11% in a week.
Brent crude rose by as much as nearly 1% to US$77.40 a barrel, close to its highest since January.
Gold, which tends to struggle when the dollar gains, pared earlier losses to trade at US$3,372 an ounce, up 0.1% on the day.
The dollar itself rose broadly, leaving the euro down 0.1% at US$1.1466 and the Australian and New Zealand dollars – both risk-linked currencies – down 0.7% and 1%, respectively.
Central bank policy
Overnight, the Federal Reserve (Fed) delivered mixed signals to markets. Much to Trump's displeasure, policymakers held rates steady as expected and retained projections for two quarter-point rate cuts this year.
However, Fed chair Jerome Powell struck a cautious note about further easing ahead, saying at his press conference that he expects 'meaningful' inflation ahead as a result of Trump's aggressive trade tariffs.
Strategists at MUFG said the Fed 'is underestimating the weakness in the economy that was present before the tariff shock, specifically, almost ignoring the cracks that have been visible in the labour market for years'.
The Bank of England left UK rates unchanged, as expected, and policymakers said trade policy uncertainty would continue to hurt the economy, triggering a drop in the pound.
The Norges Bank surprised markets with a quarter-point cut that weighed on the crown currency, while the Swiss National Bank cut interest rates to zero, as expected, but the fact it did not go below zero gave the franc a lift, leaving the dollar down 0.1% at 0.8184 francs.
In commodity markets, the price of platinum hit its highest in almost 11 years, near US$1,300 an ounce, driven partly by what analysts said was consumers seeking a cheaper alternative to gold.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Sun
an hour ago
- The Sun
Oil prices fall as US delays decision on direct Iran involvement
SINGAPORE: Oil prices fell on Friday after the White House delayed a decision on U.S. involvement in the Israel-Iran conflict, but remained on course for a third consecutive weekly rise. Brent crude futures fell $2, or 2.5%, to $76.85 a barrel by 0648 GMT but still looked set to gain more than 3% on the week. U.S. West Texas Intermediate crude for July - which did not settle on Thursday as it was a U.S. holiday and expires on Friday - was down 14 cents, or 0.2%, to $75. The more liquid August contract was up 0.3%, or 19 cents, to $73.69. On Thursday prices jumped almost 3% after Israel bombed nuclear targets in Iran and Iran fired missiles and drones at Israel. The week-old war between Israel and Iran showed no signs of either side backing down. Iran is OPEC's third-largest producer. Brent futures trimmed previous session gains following the White House's comments that President Donald Trump would decide whether the U.S. will get involved in the Israel-Iran conflict in the next two weeks. 'Oil prices surged amid fears of increased U.S. involvement in Israel's conflict with Iran. However, the White House press secretary later suggested there was still time for de-escalation,' said Phil Flynn, analyst at The Price Futures Group. 'The 'two-week deadline' is a tactic Trump has used in other key decisions. Often these deadlines expire without concrete action,.. which would see the crude oil price remain elevated and potentially build on recent gains,' said Tony Sycamore, analyst at IG. Emril Jamil, oil research analyst at LSEG, said the 'unwavering determination' of the Organisation of Petroleum Exporting Countries and its allies (OPEC+) to increase output 'may have added jitters to the market'.
The Sun
an hour ago
- The Sun
Oil prices dip as U.S. delays decision on Israel-Iran conflict
SINGAPORE: Oil prices fell on Friday after the White House delayed a decision on U.S. involvement in the Israel-Iran conflict, but remained on course for a third consecutive weekly rise. Brent crude futures fell $2, or 2.5%, to $76.85 a barrel by 0648 GMT but still looked set to gain more than 3% on the week. U.S. West Texas Intermediate crude for July - which did not settle on Thursday as it was a U.S. holiday and expires on Friday - was down 14 cents, or 0.2%, to $75. The more liquid August contract was up 0.3%, or 19 cents, to $73.69. On Thursday prices jumped almost 3% after Israel bombed nuclear targets in Iran and Iran fired missiles and drones at Israel. The week-old war between Israel and Iran showed no signs of either side backing down. Iran is OPEC's third-largest producer. Brent futures trimmed previous session gains following the White House's comments that President Donald Trump would decide whether the U.S. will get involved in the Israel-Iran conflict in the next two weeks. 'Oil prices surged amid fears of increased U.S. involvement in Israel's conflict with Iran. However, the White House press secretary later suggested there was still time for de-escalation,' said Phil Flynn, analyst at The Price Futures Group. 'The 'two-week deadline' is a tactic Trump has used in other key decisions. Often these deadlines expire without concrete action,.. which would see the crude oil price remain elevated and potentially build on recent gains,' said Tony Sycamore, analyst at IG. Emril Jamil, oil research analyst at LSEG, said the 'unwavering determination' of the Organisation of Petroleum Exporting Countries and its allies (OPEC+) to increase output 'may have added jitters to the market'.
Malay Mail
an hour ago
- Malay Mail
French streamer Deezer begins labelling AI-made songs, moves to protect artist royalties
PARIS, June 20 — French streaming service Deezer is now alerting users when they come across music identified as completely generated by artificial intelligence, the company told AFP on Friday in what it called a global first. The announcement by chief executive Alexis Lanternier follows repeated statements from the platform that a torrent of AI-generated tracks is being uploaded daily—a challenge Deezer shares with other streaming services including Swedish heavyweight Spotify. Deezer said in January that it was receiving uploads of 10,000 AI tracks a day, doubling to over 20,000 in an April statement—or around 18 percent of all music added to the platform. The company 'wants to make sure that royalties supposed to go to artists aren't being taken away' by tracks generated from a brief text prompt typed into a music generator like Suno or Udio, Lanternier said. AI tracks are not being removed from Deezer's library, but instead are demonetised to avoid unfairly reducing human musicians' royalties. Albums containing tracks suspected of being created in this way are now flagged with a notice reading 'content generated by AI', a move Deezer says is a global first for a streaming service. Lanternier said Deezer's home-grown detection tool was able to spot markers of AI provenance with 98 percent accuracy. 'An audio signal is an extremely complex bundle of information. When AI algorithms generate a new song, there are little sounds that only they make which give them away... that we're able to spot,' he said. 'It's not audible to the human ear, but it's visible in the audio signal.' With 9.7 million subscribers worldwide, most of them in France, Deezer is a relative minnow compared to Spotify, which has 268 million. The Swedish firm in January signed a deal supposed to better remunerate artists and other rights holders with the world's biggest label, Universal Music Group. But Spotify has not taken the same path as Deezer of demonetising AI content. It has pointed to the lack of a clear definition for completely AI-generated audio, as well as any legal framework setting it apart from human-created works. — AFP
