Futures on Brent crude increased by around 6% to $95.36 per barrel. European futures dropped 1.2%, while S&P 500 futures dropped about 0.6%. However, equities benchmarks in Seoul, Taipei, and Tokyo ignored the concerns and continued to rise, with Taiwan’s stock reaching a record high and the other two following closely.
Iran has reinstated its de facto blockage of the Strait of Hormuz, yet according to Kpler data, on Saturday, the biggest day for the chokepoint since March 1, over 20 vessels carrying fertilizer, gas, metals, and oil products passed through.
With the US seizing an Iranian cargo ship and Tehran’s senior military command vowing to react, the ceasefire in the Iran conflict, which was scheduled to last until Tuesday, was in jeopardy. According to Damien Boey, portfolio strategist at Wilson Asset Management in Sydney, “the headlines look bad; it looks like there is disagreement which has led to a little bit of re-escalation.”
But I believe that, in the end, both parties want to make a deal; that’s part of why the market is optimistic and not selling off too much. Japan’s Nikkei increased 0.8%, South Korea’s KOSPI increased 1%, and Hong Kong’s Hang Seng increased 0.7%. The biggest business lender in Australia, National Australia Bank, issued one of the toughest warnings in the markets on Monday, pointing out a $500.
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