Oil jumps, dollar slightly weaker as US missiles hit Syria

(Reuters via CNBC) – Oil prices jumped more than 2 percent, US futures slipped and the Nikkei earlier fell to a four-month low on poorer risk sentiment after the US fired dozens of cruise missiles into Syria today (April 7).

Gold hit a near five-month peak today, rising over one percent on safe-haven buying.

The missile strikes happened as President Donald Trump hosts Chinese President Xi Jinping at his Mar-a-Lago resort in Florida.

A US military official told NBC that 59 tomahawks had been fired, which hit an airfield near Homs. The missiles hit aircraft and infrastructure including the runway, NBC reported. There is no word on casualties yet, but no people were targeted, the official told NBC.

In a statement, Trump said he had called for the military strike in response to a chemical attack in a rebel-held area in northern Syria. The strike also comes after Trump had said earlier in the day that “something should happen” with Syrian President Bashar al-Assad following the attack.

The dollar index traded at 100.630, after recording a three-week high at 100.77 earlier in the morning. On the energy front, Brent crude futures rose more than 2 percent before easing to a gain around 1.48 percent at $55.70 a barrel while US crude added 1.66 percent to $52.56.

“Oil prices have naturally reacted to the US bombings of Syria. It is their wont to rally on news like this, but they have always fallen back,” said John Kilduff, founding partner of Again Capital.

“The fact is that oil infrastructure is rarely damaged, and the petrodollars are the spoils of war — neither side wants to kill the ‘petro-goose.’ If anything, this airstrike sets back ISIS and makes Middle East oil supplies more secure, not less,” Kilduff said.

US futures fell after the news with Dow Jones futures down 56 points and S&P 500 futures off around 6 points, while Nasdaq futures eased 13 points. The US 10-year yield hit a low of 2.289 percent, the lowest level since Nov. 22 when the 10-year yielded as low as 2.287 percent.

Other safe-haven assets were also higher today. Spot gold was trading 0.94 percent higher at $1,263.10 an ounce. The yen traded higher against the dollar at 110.42. It had previously snapped six consecutive sessions of strengthening earlier in the session.


Top: An artistic photo of electronic stock trading boards. Photo: Hiroshi Watanabe / Getty Images via CNBC

SOURCE: Reuters via CNBC





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