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Markets tread carefully as oil holds firm

Stock markets were mixed early in the week as investors weighed renewed doubts over the fragile US-Iran ceasefire against still-resilient risk appetite, with US equities ending modestly higher on Monday, European stocks closing mostly lower and Asian markets trading mixed on Tuesday. Oil maintained recent gains, with Brent trading around USD 105 per barrel and West Texas Intermediate (WTI) around USD 99. Gold prices were slightly lower, trading around USD 4720 per ounce on Tuesday, while US Treasury yields rose across the curve as the US dollar strengthened. Investors will now look to US consumer price inflation due on Tuesday for fresh clues on the inflation outlook and the path for monetary policy.

  • Date
  • Author Shane Strowmatt, Senior Investment Writer
  • Reading time 5 minutes

Volatility
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Asia-Pacific markets traded mixed on Tuesday as investors largely looked past renewed doubts about the US-Iran ceasefire after US President Donald Trump said the truce was on "massive life support". Japan’s Nikkei 225 was trading 0.4% higher, while Korea’s Kospi was down 3.4%, retreating after a record high on Monday. Australia’s S&P/ASX 200 was 0.4% lower. Hong Kong’s Hang Seng Index was little changed, while mainland China’s CSI 300 was trading 0.2% lower. India’s Nifty 50 was also down 1% on Tuesday.

US stocks edge higher

US stock indices posted modest gains on Monday as investors stayed cautious amid uncertainty in the Iran conflict and ahead of US inflation data due on Tuesday. The Dow Jones Industrial Average rose 0.2% to 49,704.47 points, while the S&P 500 gained 0.2% to 7412.84 points and the Nasdaq 100 added 0.3% to 29,320.66 points, with all three benchmarks briefly touching record levels during trading. Sentiment was supported by continued enthusiasm for artificial intelligence, lifting chip-related stocks such as Qualcomm and Micron, although uncertainty over a possible reopening of the Strait of Hormuz and fragile ceasefire prospects kept broader gains in check.

European stocks slip on Iran

European equities ended mixed on Monday as stalled efforts to end the Iran conflict and renewed inflation concerns linked to higher oil prices weighed on sentiment. The Euro Stoxx 50 fell 0.4%, while Germany’s DAX was little changed and France’s CAC 40 lost 0.7%. Switzerland’s SMI was little changed. With most US megacap earnings now behind us, investors’ focus shifts to European blue chips this week, with key results from Siemens (Wednesday), Allianz (Wednesday), Deutsche Telekom (Wednesday), Zurich Insurance (Wednesday) and National Grid (Thursday).

Corporate and economic calendar

Corporate news in focus: Quarterly figures from Bayer and Munich Re.

Economic data in focus: German Consumer Price Index (08:00), Swiss Producer and Import Price Index (08:30), German ZEW Indicator of Economic Sentiment (11:00), US Consumer Price Index (14:30).

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Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.