investingLive European markets wrap: US-Iran tensions escalate ahead of big CPI report
Headlines:
- Trump on Iran: They’ve taken too long to negotiate a deal, now they will have to pay price
- Iran’s Baghaei: Tehran needs to re-assess talks with the US following overnight clashes
- US futures hold lower with inflation data in focus
- The S&P 500 is at risk of another selloff as traders hold their breath ahead of the US CPI
- What is the distribution of forecasts for the US CPI?
- BOJ governor Ueda has been hospitalised, expected to be absent from next week’s meeting
- BOJ to raise interest rates to 1% in June meeting – poll
Markets:
- S&P 500 futures down 1.0%, Nasdaq futures down 1.5%
- Oil prices stay underpinned, WTI crude up 1.5% to $89.50
- US dollar keeps steadier across the board
- US 10-year yields up 1.4 bps to 4.54%
- Gold down 2.3% to $4,165
- Bitcoin down 2% to $60,898
Well, thar she blows! After all the talk of being “very close" to a deal, US president Trump is out saying that enough is enough. He is threatening fresh strikes against Iran’s infrastructure, noting that negotiations are taking too long and that Tehran must now “pay the price".
That’s adding to further risk jitters to a market that is already looking nervous ahead of the US CPI report later today. Is it perhaps a case that Trump got a look that the inflation numbers are going to run hot and he fears how the market will respond to that? We shall see.
But for now, it’s all shaping up to be a more risk-off mood as we look towards US trading later.
US futures are being dragged through the mud as the tech selloff deepens on the week. S&P 500 futures are down 1% now with Nasdaq futures down 1.5%. All of this is making for a rather gloomy mood ahead of the SpaceX IPO on Friday.
Meanwhile, oil prices are staying underpinned with WTI crude up 1.5% to $89.50. And in the major currencies space, the dollar continues to hold steadier across the board. The changes are light besides a drop in the aussie, owing to a more defensive risk mood.
In other markets, 10-year Treasury yields are up 1.4 bps to 4.54% while precious metals are seeing the selloff extend further with gold down 2.3% to $4,165 on the day.
Dum, dum, dum.
The hammer is starting to fall and things look like they could get much uglier before they get better now. It’s on to the US CPI report next.
This article was written by Justin Low at investinglive.com.