By Dow Jones Newswires Staff
Oil jumped and stocks sank after President Trump's prime-time address to the U.S. undermined investor hopes that an end to the war in the Middle East was near.
Trump promised more attacks against Iran and offered no clear timeline on an end to the conflict. Market sentiment wilted in response, with Brent crude rising close to $108 a barrel after falling below $100 Wednesday. Asian stocks gave up early gains to close in the red, and U.S. futures pointed down.
Gold and silver dived as Treasurys faltered, while the dollar strengthened. Investors look to U.S. trade balance data for February and a weekly jobless claims update. Equity markets in Europe and the U.S. will shutter for Good Friday. U.S. bond markets will trade until noon tomorrow, with investors watching for March non-farm payrolls data.
--Oil prices climbed more than $5 on Trump's address. In early European trading, the front-month Brent contract for June delivery soared 6.6% to $107.82 a barrel, while West Texas Intermediate futures for May rose 6.1% to $106.19 a barrel. Natural-gas prices also gained, with the front-month Dutch TTF contract--the European benchmark--up 4.8% to 49.87 euros a megawatt-hour.
"The President's characteristic ambiguity leaves multiple military options open in the near term," said Claudio Galimberti, chief economist at Rystad Energy. "Until there is greater clarity on the path to de-escalation, markets are likely to remain highly volatile."
--U.S. stock futures sank following Trump's address. Futures on the Dow Jones Industrial Average were recently off by 1.1%, while S&P 500 futures were down 1.25%. The tech-heavy Nasdaq-100 futures slid 1.55%.
--Asian markets extended losses during Thursday late trade as President Trump's speech offered no clarity on the end to the Middle East conflict. South Korea's Kospi ended 4.5% lower and Japan's Nikkei Stock Average lost 2.4%. Hong Kong's Hang Seng Index was down 0.9%.
--European stocks were down at the open. Banks and industrial stocks slipped as the Europe-wide Stoxx 600 fell 1.2%, largely reversing gains made in the last session. Germany's DAX slid 1.5% as energy-intensive manufacturing stocks fell. In Paris, losses for luxury stocks and industrials dragged the CAC 40 1.25% lower. Italy's FTSE MIB and Spain's IBEX 35 dropped 1.2% and 1.3%, respectively. Gains for oil majors in London cushion the FTSE 100's losses as the index slid 0.7%.
--The dollar rose as doubts over a swift end to the Iran war weaken risk sentiment and lift oil prices. The greenback is boosted by its safe-haven role and America's position as a net oil exporter. The DXY dollar index rose 0.5% to 100.111.
--U.S. Treasury yields rose across the curve in Asian trade as oil prices increased, with investor optimism about an end to the Middle East conflict in the near term fading again. The two-year Treasury yield rose 5.7 bps to 3.859%, the 10-year Treasury yield was up 5.9 bps at 4.379% and the 30-year yield rose 5.1 bps to 4.952%.
Eurozone government bond yields tracked U.S. Treasurys higher. The 10-year German Bund yield rose 4.1 basis points to 3.027% while the 10-year French OAT yield jumped 6.3 basis points to 3.744%. France's upcoming 10.5 billion-12.5 billion euros auction of long-dated government bonds likely exacerbated selling in French bonds.
--Bitcoin fell 2.2% to $66,664, dropping back after hitting its highest level in nearly a week at $69,232 on Wednesday, LSEG data show.
--New York gold futures tumbled 4% to $4,619.30 a troy ounce. Other precious metals also plunged, with silver falling 7.3% to $70.54 an ounce and platinum trading 4.6% lower at $1,896.70 an ounce. Rising inflation risks tied to higher oil prices are clouding the outlook for interest-rate cuts, outweighing gold's safe-haven appeal. Still, gold remains on track for a weekly gain of more than 5%, supported by a rebound earlier in the week after Trump signaled the U.S. could step back from Iran within two to three weeks.
Write to Barcelona Editors at barcelonaeditors@dowjones.com
(END) Dow Jones Newswires
04-02-26 0424ET
