A look at the day ahead in European and global markets from Tom Westbrook Oil futures jumped back over $100 at the open in Asia on Monday, the dollar fell and stocks were down as U.S.-Iran talks
Oil Prices Surge Past $100 as US Imposes Blockade on Iran, Markets Volatile
Market Reactions and Economic Impact
A look at the day ahead in European and global markets from Tom Westbrook
Oil and Commodity Price Movements
Oil futures jumped back over $100 at the open in Asia on Monday, the dollar fell and stocks were down as U.S.-Iran talks collapsed without making progress toward any durable peace. [MKTS/GLOB]
US Blockade on Iran
The U.S. also announced a blockade of Iranian ports nL6N40V09S, a measure aimed at ratcheting up pressure on Tehran, as well as on the recipients - mainly China - of Iranian crude.
Expert Analysis and Supply Impact
The blockade, experts say nL1N40V06L, is an act of war that requires an open-ended commitment of a significant number of warships. The cut to global supply, if Iranian exports are removed, would be up to 2 million barrels per day.
Soft Commodities and Inflation Concerns
Soft commodities also rose sharply on heightened concern about disruption to fuel and fertiliser supplies, and bonds were sold on worries about the risks to inflation. [GRA/]
Political Developments and Market Response
Hungary's Election and EU Funding
Hungary's forint shot higher nL1N40W01F after the defeat of Viktor Orban nL8N40V07J at Sunday's election nL1N40V01B paved the way for European Union funding to flow nL1N40Q0A6 to Hungary and perhaps Ukraine.
Asia Session and Asset Price Stabilization
Other reactions in the Asia session to the breakdown of U.S.-Iran talks, however, were not extreme and sent most asset prices back to where they sat around the middle of last week, before the U.S., Israel and Iran agreed a ceasefire.
That will leave markets trading the headlines while U.S. earnings season begins in earnest nL6N40T177 with Goldman Sachs reporting before the market opens.
Key Developments to Watch
Key developments that could influence markets on Monday:
- Hungarian election result
- U.S. earnings: Goldman Sachs
(Editing by Sonali Paul)
