Markets steady, crude oil prices ease on Tuesday after volatile start to
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The U.S. stock market and oil prices are holding relatively steady Tuesday, for now, following their stunning swings up and down since the war with Iran began.
The S&P 500 edged down 0.1 per cent in early trading, a day after careening from a sharp early loss to a solid gain by the end of trading. The Dow Jones Industrial Average was down 34 points, or 0.1 per cent, as of 9:35 a.m. ET, and the Nasdaq composite was 0.1 per cent higher.
Calm was also holding in the oil market, which has been the centre of action for financial markets because of worries about the potential for long-term disruptions to the energy industry in the Middle East.
The price for a barrel of Brent crude, the international benchmark, was sitting at $91.81 US. That’s down 7.2 per cent from its settlement price the day before, but much of that decline happened before the end of Wall Street’s trading day on Monday.
A barrel of benchmark U.S. crude was also sitting close to where it was during the last moments of Monday’s trading for the U.S. stock market, and it was at $88.57 US.
On Monday, markets swung from big losses to finish the day with gains, while oil prices neared $120 US per barrel before falling back to about $90.
Helping to assuage investors’ fears, U.S. President Donald Trump told CBS News on Monday that he thinks “the war is very complete, pretty much.”
However, Trump also made other somewhat contradictory comments that seemed to threaten intensified action against Iran if it makes any “attempt to stop the globe’s oil supply.”
Iran launched new attacks on Tuesday at Israel and Gulf Arab countries, keeping pressure on the Middle East in a war started by Israel and the United States 10 days ago that has sent oil prices surging.
The ongoing uncertainty for the global oil supply because of the U.S.-Israel war with Iran caused a volatile day for markets on Monday, with oil prices skyrocketing in the morning only to tumble back down later in the day.
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, household 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.
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