AP/Richard Drew
- Oil, gold, and bitcoin jumped on Monday ahead of Trump’s reveal of “major” sanctions on Iran.
- Rising US-Iran tensions and a prolonged US-China trade war have lifted commodity and cryptocurrency prices.
- Bitcoin broke $11,000 overnight, its highest price in more than a year.
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Oil, gold, and bitcoin jumped on Monday ahead of President Trump’s reveal of “major” sanctions on Iran, as traders parked their cash in commodities and cryptocurrencies in the face of rising geopolitical tensions.
“We are putting major additional sanctions on Iran on Monday,” President Trump tweeted on Saturday. The US has accused the Middle Eastern nation of attacking two tankers in the Gulf of Oman and shooting down an unmanned US drone over international waters in the past two weeks, and reportedly launched a cyberattack against an Iranian spy group despite Trump canceling a missile strike on Thursday.
“Expect lots of turbulence from this, but ultimately it does not look like the White House is spoiling for a fight,” said Neil Wilson, chief market analyst for Markets.com.
Here’s the market roundup as of 9.50 a.m. (4.50 a.m. ET):
- Oil prices increased as traders feared a US-Iran conflict could cause supply disruptions. West Texas Intermediate crude rose 0.8% to $57.90, while Brent crude rose 0.2% to $64.60.
- Gold climbed 0.7% to $1,409 as investors fled to safe havens in the face of rising geopolitical tensions.
- Bitcoin rose 1.1% to $10,880. It broke past $11,000 mark on Sunday night, after passing $10,000 on Friday evening. It has more than tripled in value since December, and has rallied to more than half of its all-time high.
- Asian stocks were mixed with the Shanghai Composite up 0.2%, Hong Kong’s Hang Seng up 0.1%, and the SZSE Component marginally lower.
- European equities retreated with Germany’s DAX down 0.4%, the Euro Stoxx 50 down 0.3%, and Britain’s FTSE 100 almost flat.
- US markets are set to open higher with futures underlying the Dow Jones Industrial Average and S&P 500 up 0.2%, and the Nasdaq up 0.3%.
Traders were also awaiting Trump’s scheduled meeting with Chinese President Xi Jinping at the G-20 summit in Japan later this week. However, analysts are skeptical whether the pair will strike a deal to end their trade war, given the US blacklisted several more Chinese companies last week.
“Perhaps the very best markets can hope for is more patient delay and position building at the G-20 that at least sees the US and China refrain from any further escalation,” said Michael Every, senior Asia-Pacific strategist at RaboResearch.
The US also remains at loggerheads with Turkey over its planned purchase of the S-400 missile system from Russia. However, Turkish President Recep Tayyip Erdogan suffered a setback on Sunday after his handpicked candidate lost to the opposition party’s representative in the Istanbul mayoral race.
