Tag: global markets

Asia stocks set to fall as Meta drags on big tech

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian equity markets dropped after Meta Platforms Inc.’s disappointing outlook raised concern on whether the industry that has powered the bull market in equities has run too far.

Equity benchmarks dropped in Japan and South Korea, while futures for Hong Kong also declined. Australian financial markets are shut for a holiday. The yen traded in a narrow range after weakening beyond 155 per dollar for the first time in more than three decades on Wednesday, heightening the chances of intervention.

A $250 billion exchange-traded fund tracking the Nasdaq 100 got hit after the close of regular US trading as the Facebook parent tumbled more than 15%. Meta projected second-quarter sales that were below analyst expectations and increased its spending estimates for the year.

“Meta’s resources are vast, but not infinite,” said Sophie Lund-Yates, an analyst at Hargreaves Lansdown Plc. “The language around spending plans has become bolder once more, and this could be what’s spooking markets.”

In the run-up to the results, the S&P 500 struggled to gain traction, hovering near 5,070 as traders positioned for economic data that will help shape the views on the Federal Reserve’s next steps. Treasuries opened little changed in Asia after yields rose on Wednesday.

In Japan, the yen depreciated to as low as 155.37 per dollar on Wednesday, marking the first time since June 1990 the currency had crossed the 155 level. Traders will be alert to any comments from officials in Tokyo on Thursday that suggest a higher state of readiness for intervention.

Japan’s weak currency is a “big problem,” Japan Airlines Co. Chief Executive Officer Mitsuko Tottori said in a group interview, adding that a stronger rate than the current level of around ¥155 to the dollar would be better.

South Korea’s SK Hynix Inc. said it expects a full recovery in the memory market after AI demand spurred the chipmaker to log its fastest pace of revenue expansion since at least 2010.

Elsewhere, oil held a modest decline, with a risk-off tone in broader markets countering a drawdown in US stockpiles. Gold was little changed.

Earnings Unfolding

The Facebook parent reported revenue of $36.5 billion in the first quarter, an increase of more than 27% over the same period a year ago. It was a small beat, as analysts were looking for revenue of $36.1 billion on average, according to estimates compiled by Bloomberg. Profit more than doubled to $12.4 billion.

“We encourage investors to focus on the positives,” said Tejas Dessai at Global X ETFs. “The company’s fundamentals continue to show strength, and that’s the key story.”

To Mark Hackett at Nationwide, while the cohort of seven tech megacaps has done well in the last two years because of their superior earnings growth relative to the broader market, this advantage could decrease in 2024 and even more significantly in 2025.

“The ‘Magnificent Seven’ are not nearly as powerful as they once were,” Hackett said. “We see this as a positive development for investors looking to diversify away from the recent market leaders.”

For weeks, traders have been scaling back how many rate cuts they expect from the Fed amid a string of resilient economic data. Economists surveyed by Bloomberg predict gross domestic product likely cooled to around 2.5% in the first quarter, with the figures still potentially suggesting persistent inflationary pressures.

“Tomorrow’s pivotal GDP report comes as market participants hope for a soft number that would lead to rate cuts sooner rather than later,” said Jose Torres at Interactive Brokers. “We expect a stronger-than-projected figure. It would be great for revenue growth prospects, but bad for the timing and extent of rate cuts.”

Also Read: Trade Setup for April 25: Nifty looks to end April expiry on a high, but HUL, Kotak Bank may weigh

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Oil holds gain with stockpile data and Iran sanctions in focus

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Oil held a gain as an industry report showed shrinking US crude stockpiles, and traders tracked progress toward fresh sanctions against Iran.

Brent was steady above $88 a barrel after climbing 1.6% on Tuesday, while West Texas Intermediate was over $83. The American Petroleum Institute reported nationwide crude inventories fell 3.2 million barrels last week. If confirmed by official data later Wednesday, that would be the first drop in five weeks.

The US House of Representatives, meanwhile, passed tougher measures against Iran in response to an attack on Israel, with the Senate set to ratify them. While some Asian refiners are bracing for added scrutiny, the move isn’t expected to have a significant market impact.

Crude has climbed this year, lifted by supply cutbacks from OPEC+, as well as geopolitical risks in the Middle East and Russia. Traders are also weighing the outlook for US monetary policy, with slower US business activity growth being interpreted as bullish as it feeds into expectations for lower interest rates. Data on the Federal Reserve’s preferred inflation gauge is due later this week.

The API also flagged a drawdown in overall gasoline levels, while crude stockpiles at the Cushing, Oklahoma, hub were seen shrinking.

Also Read: Asian stocks rise as Tesla buoys US tech giants

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks rise as Tesla buoys US tech giants

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stocks in Asia advanced after a US rally in tech heavyweights, whose high-stakes earnings are considered by Wall Street investors a major test of the equities bull run.

Equity benchmarks rose in Japan and South Korea, while futures for Hong Kong pointed up. US futures gained in early Asian trading. In late US hours, Tesla Inc. soared as the electric-vehicle giant struck an upbeat tone despite a sales miss, the first of the “Magnificent Seven” megacaps to report. The stock halted a seven-day plunge, climbing alongside other members of the group.

Meanwhile, weakness in measures of business activity helped keep alive forecasts for US rate cuts this year, which was positive for equities but weighed on the dollar and Treasury yields.

After hitting several record highs this year, equities have lost traction in the past few weeks on signals the Federal Reserve will hold rates higher for longer. The slide made stocks more attractive as it removed market froth, with investors now focused on earnings, according to Citigroup Inc. strategists.

“We would view the recent pullback as a buying opportunity,” Citi’s Mihir Tirodkar and Beata Manthey said. “Bullish positioning has unwound and now looks more neutral, particularly in the US. The current earnings season could refocus investor attention on solid underlying fundamentals.”

The S&P 500 notched its best back-to-back rally in two months. Nvidia Corp., the poster child of the artificial-intelligence boom, led a surge in chipmakers. Texas Instruments Inc. gave a bullish revenue forecast — a good sign for the chip industry that may help lift Asian producers on Wednesday.

Treasuries were largely steady after briefly extending gains on a solid $69 billion sale of two-year notes — but quickly returned to levels seen ahead of the auction — with 10-year yields little changed.

Oil held a gain as an industry report showed shrinking US crude stockpiles and traders tracked progress toward fresh sanctions against Iran. Gold is little changed.

In Japan, the yen was steady within sight of reaching the psychological 155 level to the dollar, keeping traders on guard for potential intervention by authorities to prop up the currency.

Earnings on Watch

Morgan Stanley’s Mike Wilson said the bar is high for US firms to deliver on earnings, particularly for megacap technology names, which face tough comparisons from the growth they showed last year.

Besides Tesla, Microsoft Corp., Meta Platforms Inc. and Alphabet Inc. are also due to report earnings this week. Profits for the “Magnificent Seven” group — which also includes Apple Inc., Amazon.com Inc. and Nvidia Corp. — are forecast to rise about 40% in the first quarter from a year ago, according to Bloomberg Intelligence data.

The group of tech megacaps is crucial to the S&P 500 since the companies carry the heaviest weightings in the benchmark. After this year’s advance, valuations have gotten lofty. After the latest selloff, the Magnificent Seven still traded at a combined 31 times forward earnings, according to data compiled by Bloomberg.

Also Read: Trade Setup for April 24: Is the recent Nifty recovery set for a temporary pause?

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Oil holds modest loss as risks of Middle East escalation recede

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Oil held a modest decline as the risk of a significant escalation of hostilities between Israel and Iran eased following a tit-for-tat exchange of attacks last week.

Brent traded near $87 a barrel after losing 0.3% on Monday, and West Texas Intermediate was above $82. Israel is returning to its goals of eliminating what it says is the last remaining stronghold of Hamas in Gaza and of freeing the remaining hostages, which will keep tensions elevated in the region.

“Crude has unwound the Israel-Iran risk premium but could slip into a holding pattern,” said Vandana Hari, founder of Vanda Insights in Singapore. “It’s hard to see a correction from current levels unless there’s a breakthrough on the Gaza front.”

Futures are coming off a back-to-back weekly loss, but remain higher this year due to geopolitical risks and OPEC+ supply cuts that have tightened the market. The US Congress has moved to further curb Iran’s oil sector, although analysts see a muted impact on exports.

Easing tensions are being reflected in the options market, with bullish Brent calls losing its premium to the opposite puts as of Monday’s close. However, timespreads are still signaling strength, with the gap between the two nearest contracts for the global benchmark at 94 cents a barrel in backwardation, compared with 79 cents a week ago.

Also Read: Asian stocks track US rebound on profit optimism

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks track US rebound on profit optimism

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Asian stocks rose after US shares rebounded from a $2 trillion selloff on optimism big tech leaders will announce hefty profits this week.

Benchmark indexes advanced in Japan and South Korea, while futures in Hong Kong also pointed to gains. Contracts for US equities were little changed after the S&P 500 topped 5,000 — halting a six-day rout — while the Nasdaq 100 rose 1%, with Nvidia Corp. leading gains in big tech. Apple Inc. was named a top pick for 2024 at Bank of America Corp. on optimism over its upcoming results.

Investors are waiting to see if earnings will meet the lofty expectations for artificial intelligence this week when about 180 companies in the S&P 500 — representing over 40% of the gauge’s market capitalization — are due to report their results. Stakes are high for the “Magnificent Seven” megacaps, whose profits are forecast to rise nearly 40% from a year ago, according to Bloomberg Intelligence. The focus on earnings comes after a rout fueled by geopolitical fears and signals the Federal Reserve will be in no rush to cut rates.

“Concerns about rising interest rates, stubborn inflation, and geopolitical risks aren’t going anywhere — but this week, the tech sector may be ‘calling the shots’,” said Chris Larkin at E*Trade from Morgan Stanley.

Treasuries were flat in Asia ahead of a flurry of bond auctions that will test investors’ appetite after yields hit the highest in 2024. Australian bonds gained in early trading.

Oil held a modest decline as investors were encouraged after Middle East tensions eased. Gold edged higher after tumbling 2.7% on Monday as haven demand waned.

In Asia, focus returns to China’s role as a major lender to developing nations amid a report the head of its central bank wants creditors engaged in debt restructurings to agree on how to fairly share the burden of relief.

Elsewhere, the yen traded near 34-year low versus the dollar, keeping alive speculation Japanese authorities will step up verbal intervention or take action to support its beleaguered currency.

Strategists at Wall Street’s top banks are split on whether companies can deliver on robust forecasts. While Morgan Stanley’s Michael Wilson said he expects profit growth to improve as the economy strengthens, his counterpart at JPMorgan Chase & Co., Mislav Matejka, argues that hot inflation, a stronger dollar and geopolitical tensions are clouding the outlook.

Nearly two-thirds of 409 respondents in Bloomberg’s Markets Live Pulse survey said they expect earnings to give the US equity benchmark a boost. That’s the highest vote of confidence for profits since the poll began asking the question in October 2022.

The challenge to S&P 500 returns this earnings season is that companies will have to produce earnings — and outlooks — that support the already elevated multiples, according to Megan Horneman at Verdence Capital Advisors.

Indeed, the stakes are high for America’s technology behemoths to start delivering on artificial intelligence promises with their earnings poised to decelerate, according to Bank of America Corp. strategists.

Microsoft Corp., Alphabet Inc., Meta Platforms Inc. and Tesla Inc. report results this week — kicking off earnings for the so-called Magnificent Seven. With AI seen as the key to future profits, its contributions to the earnings mix is a focus for traders, a BofA team including Ohsung Kwon and Savita Subramanian said.

Also Read: Trade Setup for April 23: Reliance Industries to determine Nifty trajectory after 600-point recovery

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Oil falls after weekly loss as traders focus on Middle East risk

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Oil fell after its first back-to-back weekly decline this year as traders weighed the potential next steps from Iran and Israel amid simmering tensions in the Middle East.

Brent slipped below $87 a barrel after losing 3.5% last week, the biggest drop since early February. There’s an uneasy calm over the market after prices whipsawed on Friday, with Iran downplaying Israel’s response to the Islamic Republic’s unprecedented drone and missile strike on the Jewish state.

The US House has passed new sanctions on Iran’s oil sector following the hostilities, putting the measure on track to pass the Senate in days. The country also approved fresh funding for Ukraine in its war against Russia.

Money managers are the most bullish on Brent since March 2021 as they snap up contracts to profit from any spike higher amid heightened geopolitical risk. Other markets are also signaling bullishness, with oil call options — which profit when prices rise — trading at a premium over the opposing puts.

Oil is around 13% higher this year due to the geopolitical tensions and OPEC+’s supply cuts that have tightened the market. Investors will focus on a slew of US economic data this week, including the Federal Reserve’s preferred measured of inflation, which will give more clues on the path for monetary policy.

Earnings from the world’s largest oil majors including TotalEnergies SE, Chevron Corp. and Exxon Mobil Corp. are also due this week, as well as Asian companies Reliance Industries Ltd. and Cnooc Ltd.

Also Read: Asian stocks rebound with earnings, data in focus

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks rebound with earnings, data in focus

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Asian stocks opened higher as focus shifted to a slew of company earnings and economic data this week for insight into the direction of central bank policy.

Benchmarks in Japan, Australia and South Korea all rose more than 1% early Monday, partially recovering after last week’s slump. The dollar was slightly weaker as traders took some comfort in the absence of further escalation from Iran following Israel’s retaliatory strike.

The rebound comes after traders last week were whipsawed by Middle East tensions as well as hawkish comments from Federal Reserve officials indicating reluctance to cut rates anytime soon. US growth and Fed’s preferred measure of inflation are due this week, which will help finesse bets on timing of rate cuts. Investors must also absorb a hefty slate of Treasuries auctions.

Also in focus in the region for Monday is China’s loan prime rates.

The Fed has entered its media blackout period and “the market often softens its Fed expectations during this quiet period,” said Win Thin, global head of markets strategy at Brown Brothers Harriman in New York. “However, the Fed has been sending a consistently hawkish message in recent weeks and markets would do well not to forget that.”

The S&P 500 saw its worst week since March 2023 last week — extending a drawdown from its all-time high to more than 5%. After the gauge’s strongest start to a year since 2019, investors have been increasingly skeptical about how much further the market could go over the near term, even accounting for the continued strength in the economy.

More than half of the “Magnificent Seven” cohort of tech megacaps will report earnings this week — leaving investors wondering whether those firms are going to live up to the high expectations set for artificial intelligence. Profits for the seven biggest growth companies in the S&P 500 — Apple Inc., Microsoft Corp., Alphabet Inc., Amazon.com Inc., Nvidia, Meta Platforms Inc. and Tesla Inc. — are on course to surge 38% in the first quarter, according to Bloomberg Intelligence. When excluding them, the rest of the benchmark index’s profits are anticipated to shrink by 3.9%.

Meantime, conflicts in the Middle East and Ukraine continue to simmer. Ukrainian authorities were jubilant at the approval in the US House of more than $60 billion in aid, with President Volodymyr Zelenskiy vowing the funds will help retake the initiative in its fight against Russia’s invasion.

The limited Israeli strike on Iran and the muted response from the Iranian leadership potentially provide an opportunity for the conflict between the long-term adversaries to scale back, for now, according to RBC Capital Markets.

“It is far from an easy truce and could be tested once again as the broader Middle East backdrop remains fraught, even if the worst outcome did not come to pass,” Helima Croft, head of global commodity strategy at RBC, wrote in a note to clients. “The last two weeks have shown that this war can take sudden escalatory turns and that opposing sides may lack a cogent understanding of the other’s red lines, thereby risking a fog of war dynamic.”

Oil fell after its first back-to-back weekly decline this year as traders weighed the potential next steps from Iran and Israel. Gold slipped.

Elsewhere this week, inflation readings in Australia and Malaysia are due. Bank Indonesia will give a policy decision just as the currency comes under pressure, while earnings at global growth bellwether Caterpillar are due.

Also Read: Trade Setup for April 22: Nifty looks to sustain Friday’s recovery amidst tech sell-off, RIL results

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Oil back above $90 a barrel after Israel attacks Iran

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Oil prices jumped $3 a barrel on Friday in reaction to unconfirmed reports on X that explosions had occurred in Iran, sparking concerns that Middle East oil supply could be disrupted.

Brent futures jumped $3.03, or 3.5%, to $90.14 a barrel by 0147 GMT, and US West Texas Intermediate crude rose $3.03, or 3.7%, to $85.76 per barrel.

“There are some unconfirmed reports of explosions in the Middle East,” ING’s head of commodity research, Warren Patterson, said.

The reports have sparked worry that Israel has responded to Iran’s drone and missile attack of last weekend, Patterson said.

Investors have been closely monitoring Israel’s reaction to the April 13 Iranian drone attacks on Israel. The geopolitical risk premium in oil prices had been unwinding this week on the perception that any Israeli retaliation to Iran’s attack would be moderated by international pressure.

In global crude oil supply, Venezuela lost a key U.S. license allowing the OPEC member to export oil to markets globally. The U.S. also announced sanctions on Iran, another OPEC member, targeting its unmanned aerial vehicle after the country’s drone strike on Israel last weekend.

The sanctions on Iran, however, exclude its oil industry.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks fall as yen in range after Japan CPI

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian stocks dropped after US shares and Treasuries extended this month’s selloff following solid economic readings and hawkish Federal Reserve commentary.

Equities in Australia, Japan and South Korea all fell, as did equity futures in Hong Kong. Contracts for US shares were lower after the S&P 500 slipped for a fifth day Thursday, with its most influential group — technology — leading declines.

Treasuries were little changed in Asia after declining across the US curve Thursday with two-year yields once again near the 5% mark. Australian bonds slipped in early trading, following the move in Treasuries. An initial quarter-point Federal Reserve interest-rate cut remained priced in for November.

The yen was little changed by Japanese inflation data that came in below economists’ estimates. The 2.7% monthly reading for March was just below the 2.8% consensus forecast. An increasing number of economists expect the BOJ to raise rates again in October after it stands pat next week, with most of them flagging an earlier move in July as a risk scenario, according to a Bloomberg survey.

The dollar traded in a narrow range against its major peers in early Friday trade after advancing Thursday.

Global markets have been ravaged as traders slashed bets on Fed easing this year following a series of hawkish comments from officials and data that indicates a robust US economy. An index of global bonds is down 2.3% so far in April, a decline that — should it hold — would mark the worst month since September. The MSCI All Country World Index has dropped 2.1%, on track for its biggest weekly decline since October.

US-listed shares of Taiwan Semiconductor Manufacturing Co. dropped 4.9% after the company revised down the revenue growth outlook for the semiconductor industry, citing a softer recovery across smartphone and personal computer sectors. Infosys Ltd. slumped in the US after forecasting tepid sales growth for the year.

New York Fed President John Williams said while it’s “not” his baseline expectation to hike interest rates, it’s possible — if warranted. His Atlanta counterpart Raphael Bostic said he doesn’t think it will be appropriate to ease until toward the end of 2024. The Fed may “potentially” hold rates steady all year, Minneapolis Fed chief Neel Kashkari told Fox News Channel.

In economic data, US jobless claims remained subdued, consistent with a healthy job market. Separately, the Philadelphia Fed factory index topped estimates. While existing-home sales fell, the pace was roughly in line with the median forecast of economists.

The market’s biggest worry right now is inflation, which is re-accelerating and throwing cold water on the idea of any rate cuts in 2024, according to Michael Landsberg, chief investment officer at Landsberg Bennett Private Wealth Management.

“We are firmly in the camp of no rate cuts in 2024,” he said. “We believe investors should prepare for a higher-for-longer regime when it comes to both inflation and interest rates and that investment portfolios should be positioned for these dynamics for the foreseeable future.”

Most emerging market currencies fell on Thursday, with the Mexican peso among the laggards as rising volatility derails carry trade positions that has propelled the currency higher for the past few months. Indonesia’s rupiah will be closely watched when trading resumes after the government asked state-owned firms to refrain from big dollar purchases in expectation the currency will weaken further.

Also Read: Trade Setup for April 19: Infosys may lend more pressure on the Nifty as Lok Sabha polls begin

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Oil holds sharp drop after US stockpiles expand to 10-month high

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Oil held the largest decline in two months amid a slew of conflicting signals that ranged from rising stockpiles to tensions in the Middle East and the reimposition of US sanctions on Venezuelan crude.

Global benchmark Brent traded below $88 a barrel after slumping by 3% on Wednesday, while West Texas Intermediate was near $83. US crude inventories rose by 2.7 million barrels last week, hitting the highest level since last June, while gauges of fuel demand declined.

The weak US data overshadowed the impact of geopolitical tensions in the Middle East as traders await Israel’s response to Iran’s unprecedented recent attack. At present, there’s a premium of $5 to $10 a barrel baked in, but without fresh escalation, prices may fall, according to Goldman Sachs Group Inc.

US sanctions are in focus. President Joe Biden’s administration has reimposed restrictions on Venezuelan oil, ending a six-month reprieve in a move that may hamper flows from the South American nation. At the same time, a US government official said new sanctions on Iran’s oil could be included in a House foreign aid package that could be brought to vote this week.

Oil remains higher year to date as supply cuts from OPEC+ and geopolitical risks in the Middle East and Russia have combined to aid prices. The run-up had ignited speculation that crude may regain $100 a barrel, although the ascent has now faltered, with some market metrics including timespreads pointing to slightly less tight conditions.

“The market appears to have discounted the possibility of an Israeli retaliation to Saturday’s Iranian attack,” said Vandana Hari, founder of Vanda Insights. The midweek drop suggests “that the latest bout of risk premium from heightened Israel-Iran tensions has eroded,” she said.

Also Read: Asian stocks rangebound at open, tech in focus

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow