Oil and dollar surge as Iran attack fears grow

Expectations of a US move against Iran have risen dramatically, prompting a rush to the dollar and surge for oil, says Chris Beauchamp, Chief Market Analyst at investing and trading platform IG.

Oil price surge lifts Shell

Shell has rocketed higher today, adding 15 points to the FTSE 100 as expectations of a weekend strike on Iran cause a 4% bounce in oil prices. Evidence suggests the US will go for a major and extended campaign, which inevitably raises fears that Tehran will retaliate by closing the Hormuz straits and causing major dislocation in oil markets. Combined with this and yet more strength in metals, the news has meant that the FTSE 100 is an island of gains in an otherwise risk off session.

Microsoft miss sinks tech stocks

Microsoft’s rout has seen the shares fall to their lowest level since May, with the fall taking the valuation back to levels seen around the Liberation Day volatility. The earnings have sunk a rebound in the Nasdaq 100 that seemed to promise a rotation back into tech stocks, while precious metals are delivering a lesson in momentum for traders – what works one way can also work the other, as a rush to the dollar on Iran fears prompts a dramatic unwind in positioning.