By Gregor Stuart Hunter TOKYO, April 21 (Reuters) - Stocks rebounded in early trading in Asia on Tuesday as markets took heart from reports Iran is considering attending peace talks with the United
US stocks end lower, oil gains as Iran rejects peace talks
Market Reactions to Iran War Developments
By Stephen Culp
NEW YORK, April 21 (Reuters) - Wall Street stocks followed their global counterparts to a lower close on Tuesday and crude prices extended their gains amid concerns over the latest developments involving the Iran war.
All three major U.S. stock indexes extended their losses toward the end of the session after Iran rejected a second round of negotiations, saying it would participate only if the United States abandons its policy of pressure and threats.
After the closing bell, U.S. President Donald Trump said he would extend a ceasefire in the war until an Iranian proposal is submitted.
Iran's move follows the seizure of the Iranian-flagged container ship Touska by U.S. forces to enforce Trump's blockade.
Market Drivers and Analyst Commentary
"What's happening in the Middle East is the primary market driver of the very short term, and that very short term can be minute-to-minute," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "I'm not surprised by the way the market is kind of behaving with that deadline looming near."
Federal Reserve and Economic Data
Warsh Faces the Senate
WARSH FACES THE SENATE
Kevin Warsh, Trump's pick to succeed Jerome Powell as Federal Reserve chair, called for a "regime change" at the central bank in comments before the Senate Banking Committee. Warsh called for a new approach to controlling inflation and a communications overhaul that could discourage his colleagues from saying too much about the direction of monetary policy.
Retail Sales and Inflation
A Commerce Department report showed U.S. retail sales were more robust than analysts expected in March, but much of the upside surprise was driven by a 15.5% surge in gasoline station receipts due to price spikes related to the Iran war.
Stock Market Performance
Major U.S. Indexes
The Dow Jones Industrial Average fell 292.96 points, or 0.59%, to 49,149.60, the S&P 500 fell 45.12 points, or 0.63%, to 7,064.02 and the Nasdaq Composite fell 144.43 points, or 0.59%, to 24,259.96.
European and Global Stocks
EUROPEAN, GLOBAL STOCKS DIP
European shares ended lower as risk appetite soured on Iran war concerns.
MSCI's gauge of stocks across the globe fell 6.51 points, or 0.61%, to 1,065.48.
The pan-European STOXX 600 index fell 0.87%, while Europe's broad FTSEurofirst 300 index fell 22.64 points, or 0.91%.
Emerging market stocks rose 10.37 points, or 0.65%, to 1,610.75. MSCI's broadest index of Asia-Pacific shares outside Japan closed higher by 0.77%, to 824.64, while Japan's Nikkei rose 524.28 points, or 0.89%, to 59,349.17.
Currency and Commodity Markets
U.S. Dollar and Cryptocurrencies
The U.S. dollar advanced while the retail sales report signaled economic strength.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.48% to 98.54, with the euro down 0.54% at $1.1723.
Against the Japanese yen, the dollar strengthened 0.51% to 159.6.
In cryptocurrencies, bitcoin fell 1.55% to $75,130.32. Ethereum declined 1.65% to $2,299.82.
Oil Markets
Oil prices reversed an earlier dip after Trump earlier said he did not want to extend the ceasefire.
U.S. crude rose 2.81% to settle at $92.13 per barrel, while Brent settled at $98.48 per barrel, up 3.14% on the day.
Bond Markets
U.S. Treasury yields rose after retail sales data reinforced expectations that the Fed will keep rates steady this year.
The yield on benchmark U.S. 10-year notes rose 6.3 basis points to 4.313%, from 4.25% late on Monday.
The 30-year bond yield rose 3.4 basis points to 4.9152% from 4.881% late on Monday.
The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 8.6 basis points to 3.802%, from 3.716% late on Monday.
Gold Prices
Gold prices dropped as the dollar firmed. Spot gold fell 2.95% to $4,677.54 an ounce. U.S. gold futures fell 2.71% to $4,676.40 an ounce.
Reporting Credits
(Reporting by Stephen Culp; Additional reporting by Amanda Cooper in London and Gregor Stuart Hunter in Tokyo; Editing by Rod Nickel, Will Dunham and Nick Zieminski)
