Tokyo, Mar 10: Global shares rebounded on Tuesday from their sharp declines a day before as global investors wagered that the war with Iran may not last too long.
But the gains fell far short of losses Monday, when oil prices neared USD 120 per barrel before falling back to about USD 90. US shares were set to rise, with Dow futures up 0.4 per cent at 47,970.00. S&P 500 futures rose 0.4 per cent to 6,830.75.
Helping to assuage investors’ fears, US President Donald Trump told CBS News he thinks “the war is very complete, pretty much.” He also made other comments that seemed to threaten intensified action against Iran if it makes any “attempt to stop the globe’s oil supply.”
France’s CAC 40 added 1.9 per cent in early trading to 54,248.39, while Germany’s DAX surged 2.4 per cent to 23,966.97. Britain’s FTSE 100 gained 1.6 per cent to 10,410.08.
In Asia, Tokyo’s benchmark Nikkei 225 added 2.9 per cent to finish at 54,248.39 after the government released revised economic data that showed Japan’s economy grew slightly faster than initially estimated in the final quarter of last year, boosted by solid business investments.
The economy expanded at an annual pace of 1.3 per cent. The initial estimate was a much weaker 0.2 per cent.
“Today is the rebound, obviously positive comments from President Trump overnight, we’re starting to see the light at the end of the tunnel for the war,” said Neil Newman, a managing director and head of strategy at Astris Advisory Japan.
“So volatility is going to remain with us, but things are certainly looking a lot brighter today,” he said.
Australia’s S&P/ASX 200 gained 1.1 per cent to 8,692.60. South Korea’s Kospi jumped 5.4 per cent to 5,532.59.
Hong Kong’s Hang Seng added 2.2 per cent to 25,959.90, while the Shanghai Composite index rose 0.7 per cent to 4,123.14.
Share prices have been swinging mostly in tandem with oil prices, which have gyrated as the war has deepened.
In energy trading on Tuesday, benchmark US crude fell USD 7.56 to USD 87.21 a barrel. Brent crude, the international standard, dipped USD 7.54 to USD 91.42 a barrel.
There is a great deal of uncertainty about just how high oil prices will go and how long they will stay there because of disruptions to Middle East energy facilities.
If oil prices stay very high for very long, households’ budgets already stretched by high inflation could break under the pressure. Companies would see their own bills jump for fuel and to stock items on their store shelves or in their data warehouses.
Concerns have focused on the Strait of Hormuz, a narrow waterway off Iran’s coast that a fifth of the world’s oil sails through on a typical day. Iran has threatened to set fire to ships sailing the Strait.
In currency trading, the US dollar edged up to 157.53 Japanese yen from 157.67 yen. The euro edged up to USD 1.1657 from USD 1.1636. (AP)
