US and European stocks retreated while Asian equities were mixed, with markets keeping a close eye on whether Iran will block the crucial Strait of Hormuz, which carries one-fifth of global oil output
A trader works on the floor of the New York Stock Exchange (NYSE) at the opening bell in New York City on June 23. Pic/AFP
Oil prices wobbled and stock markets wavered on Monday as traders awaited Tehran’s response to US strikes on Iranian nuclear sites over the weekend, the AFP reported on Monday.
According to the AFP, US and European stocks retreated while Asian equities were mixed, with markets keeping a close eye on whether Iran will block the crucial Strait of Hormuz, which carries one-fifth of global oil output.
When trading opened on Monday, international benchmark crude contract Brent and US equivalent WTI both jumped more than four percent to hit their highest price since January. They later dipped briefly into the red and then wobbled, standing up 0.3 percent as Wall Street opened for trading.
"Will Iran choose to choke off the Strait of Hormuz or not? That is the big question," said Bjarne Schieldrop, chief commodities analyst at SEB bank, as per the AFP.
But, "looking at the oil price on Monday morning it is clear that the oil market doesn't assign a very high probability of it happening," he added.
Iran is the world's ninth-biggest oil-producing country, exporting just under half of the 3.3 million barrels it produces per day.
"The prevailing view appears to be that the US involvement will prove limited militarily, yet effective, by seriously undermining Iran’s nuclear ambitions," said David Morrison, senior market analyst at Trade Nation, the AFP reported.
Tensions remained elevated however as Iran and Israel intensified attacks on each other on the 11th day of the war.
"The markets are not yet reacting with any degree of panic to the US airstrike on Iran's nuclear facilities as they await to see how Tehran responds," said AJ Bell investment director Russ Mould, the news agency reported on Monday.
Wall Street stocks opened slightly lower, with the S&P 500 index slipping 0.1 percent.
In Europe, sentiment on the Paris and Frankfurt stock markets was also hit by a closely watched survey that showed eurozone business activity was almost stagnant again in June.
London's stock exchange was lower with shares in airlines, including EasyJet and British Airways-owner IAG, suffering losses on fears of rising energy costs and disruptions in travel to the Middle East.
In Asia, Tokyo was lower while Hong Kong and Shanghai gained.
The dollar rose against other currencies but analysts questioned to what extent this would hold out.
(with AFP inputs)
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