US markets remain under pressure, investors are still worried about a potential escalation of tensions between the US and Iran. The US dollar is advancing and oil is declining.
Safe heaven’s assets did not respond as expected by Iran’s threatening rhetoric, with gold also remaining in negative territory today. Yields on 10-year US government bonds fell back to 1.80%, with the yen lagging behind.
“To some extent, markets have calmed down despite the harsh rhetoric on both sides in recent days.” – says Matt Forester, Chief Investment Strategist at BNY Mellon’s Lockwood Advisors. He shares that the problem now is that there is a likelihood of a further escalation of the conflict that markets are not yet aware of. And that can change very quickly.
Although investors started the first full trading week of the new year in a high spirits mood, the situation in the Middle East overshadows that mood. Traders are now waiting for Iran to meet its threats.
Source: Bloomberg Finance L.P.
Graphs: Used with permission of Bloomberg Finance L.P.
Trader Milko Zashev