A Reuters report said that investors were awaiting – early this week – any signs of a possible escalation of the conflict in the Middle East, which could increase market turmoil.
Markets expect a busy week in which a statement will be issued by the US Federal Reserve regarding monetary policy and Apple’s results.
Investors’ fears have increased – according to Reuters – about the expansion of the conflict in the past few days, after the United States sent more military equipment to the Middle East, at a time when Israel is waging a war on Gaza and bombing targets in Lebanon and Syria.
Reuters quoted Randy Frederick, Managing Director of the Trading and Derivatives Department at Charles Schwab, as saying, “The situation in Israel… causes a lot of concern.”
Brent crude futures rose 2.9% to $90.48 on Friday at settlement thanks to fears that the conflict would disrupt crude oil supplies, while gold – which is considered a safe haven for worried investors – jumped in spot transactions to more than two thousand dollars for the first time since mid-May. .
Analysts at Capital Economics said in a note on Friday that the oil market’s response to the conflict has been “weak” so far. They added, “However, any indication that other countries in the region will become more involved in the conflict will cause oil prices to rise sharply,” according to the report. Same source.
On the 23rd day of the war on Gaza, Israel bombed several areas by air, sea and land, and its raids caused dozens of martyrs and injuries in the south and center of the besieged Strip, bringing the toll to more than 8,000 martyrs – including about 3,200 children – in addition to nearly 20,000 wounded, according to the Ministry of Health in Gaza.
Treasury bond yields
Peter Cardillo, chief market economist at Spartan Capital Securities, said that if the escalation of the conflict causes an increase in US war-related spending that widens the deficit, Treasury yields will exceed the 16-year highs they have already reached.
Some investors also expect that the widening conflict will cause them to buy Treasury bonds as a safe haven, and this may lead to curbing the rise in bond yields, which move in the opposite direction to prices, and this in turn may ease pressures on stocks and other assets.
The Standard & Poor’s 500 index has fallen more than 10% since late July, when it recorded its highest levels in 2023, but the index has risen more than 7% since the beginning of the year.
“Until now, US government bonds have not performed their usual function as a safe haven,” UBS Global Wealth Management said in a note on Friday, Reuters reported.
“But escalation of the conflict will likely shift attention away from monetary policy concerns and boost demand for safe-haven Treasury bonds,” she added.
The US Central Bank is scheduled to issue its latest monetary policy statement next Wednesday, while Apple’s quarterly results are expected to highlight another busy week of corporate reports.
The Palestinian resistance, led by the “Izz al-Din al-Qassam” Brigades – the military wing of the Islamic Resistance Movement (Hamas) – launched Operation “Al-Aqsa Flood” on October 7, in response to the aggression of the occupation forces and Israeli settlers against the Palestinians and the continued raids of the blessed Al-Aqsa Mosque. .
2023-10-29 08:33:14
#Investors #alert #escalation #Middle #East #conflict
