Oil Holds Above $100, Stocks Are Mixed as Global Markets Look for Direction

By Dow Jones Newswires Staff

Oil prices held above $100 a barrel and stocks struggled for direction as traders weighed mixed signals heading into the third week of conflict in the Middle East.

The dollar was flat and Asian and European stocks were mixed after President Trump sought to pressure a range of countries to help protect trade through the Strait of Hormuz. The success of Trump's push remained unclear. Investors are focused on the crucial waterway, with markets highly sensitive to developments.

It's a bumper week for central bank activity, with interest rate-setters meeting in the U.S., Europe, and Japan as well as a clutch of other countries. Chief among them is the U.S. Federal Reserve, which is expected to hold rates steady when it concludes a two-day meeting beginning Tuesday.

--Oil prices rose in early trading, with Brent crude at $105 a barrel. Brent rose 2.5% to $105.77 a barrel after reaching $106.50 earlier in the session, while WTI was up 1.7% to $94.06 a barrel. Over the weekend, the U.S. launched strikes on Kharg Island, the site of Iran's main oil terminal, though oil facilities weren't damaged. Meanwhile, the International Energy Agency said oil reserves from Asian and Oceania countries will be released immediately, while stocks from Europe and the Americas will start flowing by the end of March.

European benchmark natural-gas contracts gained 4.3% to 52.31 euros a megawatt-hour, though they were down more than 7% on the week. "Despite war-related disruptions and many cargoes being diverted to Asia, Europe remains well supplied for now, with steady LNG flows and milder demand," analysts at ANZ said.

--U.S. stock futures suggested gains at Monday's open. Futures for the Dow Jones Industrial Average rose 0.3%, while the S&P 500 climbed 0.5%. The tech-heavy Nasdaq was 0.6% higher in early European premarket trade, with index heavyweights Nvidia and Oracle gaining 0.9%. Artificial-intelligence leaders head to San Jose for the beginning of Nvidia's AI conference which begins today.

Meanwhile, Facebook-owner Meta rose 2.8% premarket after Reuters reported late Friday that the company is considering massive job cuts impacting 20% or more of its workforce. If realized, the job cuts "would reinforce that AI is beginning to deliver real productivity gains at scale, while helping offset a significant AI [capital expenditure] ramp," Jefferies' Brent Thill said.

--Asia markets were mixed at the start of the week as traders parsed conflicting messages from the Trump administration. South Korea's Kospi ended 1.1% higher, snapping a two-session losing streak, boosted by chip stocks. The Hang Seng Index trades 1.3% higher and China's Shanghai Composite closed 0.3% lower, despite a better-than-expected set of economic data. Taiwan's Taiex was down 0.2% In Japan, the Nikkei Stock Average finished 0.1% lower, dragged by auto, and electronics stocks.

--European blue-chip indexes struggled for direction in early trade. Banks and energy companies, including oil majors BP and Shell, pushed the U.K.'s FTSE 100 0.3% higher. In Paris, the French CAC 40 was flat. A strong open for luxury stocks aided the index, with sector bellwether LVMH rising 0.9%, though automakers Stellantis and Renault dragged.

Similarly, the German DAX was flat. Commerzbank jumped 3.5% after Italian bank UniCredit launched an offer to raise its stake in the German lender, though autos weighed on the index. Spanish IBEX 35 traded 0.1% lower, while the Italian FTSE MIB slipped 0.3% as UniCredit fell 1.4%.

--The dollar was little changed in early European trade, staying close to its highest in more than nine months hit on Friday. The DXY dollar index traded flat at 100.342, having hit a high of 100.54 on Friday.

Uncertainty in energy supply due to oil transport disruptions in the Middle East are likely to expose the euro to weakness versus the dollar, Danske Bank's Filip Andersson said in a note. The euro last edged up 0.1% at $1.1430, having earlier hit $1.1410 which matched Friday's 7.5-month low.

--U.S. Treasury yields fell in Asian trade, reversing last week's moves as markets shifts focus to the Federal Reserve's reaction to the impact of the Middle East crisis to be observed at this week's meeting. The two-year Treasury yield fell 2.5 bps to 3.706%, the 10-year yield was down 2.4 bps at 4.259% and the 30-year yield declined 1.8 bps to 4.889%, according to Tradeweb.

Eurozone government bond yields were little changed in early trade. The 10-year German Bund yield was up 0.4 basis points at 2.975%, while the 10-year Italian BTP yield was down 0.7 basis points at 3.780%, according to Tradeweb.

--Bitcoin rose to its highest level in a month as it continued to recover gradually from recent weakness. Much of the recent gains in bitcoin simply reflect a modest recovery after its "miserable performance" early this year, Navellier & Associates' Louis Navellier said. Bitcoin rose 2.4% to $73,457, having earlier hit a high of $74,342, LSEG data show.

--Gold prices fell 1% in early trading, as rising energy prices raise concerns around U.S. interest-rate cuts and support the dollar. Gold futures in New York were down 1% to $5,009.90 a troy ounce, while silver slipped 2.6% to $79.22 an ounce.

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(END) Dow Jones Newswires

03-16-26 0535ET