Stocks rebound and Oil slumps despite further conflict

Chris Beauchamp IG

Investors have rapidly recovered their optimism despite the continued Middle East conflict, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.

Investors shrug off Middle East worries

Friday’s outbreak of volatility has given way to a rebound in risk appetite, as investors breathe a sigh of relief that the Middle East conflict now underway remains contained. This might seem like excessive optimism, given the potential for the war to spiral into a new and much more dangerous phase. The sigh of relief uttered by equities was buttressed by reports that Tehran was seeking an end to hostilities, a sign perhaps that Israel’s ‘shock and awe’ campaign has had real impact in Iran’s corridors of power.

Oil prices reverse course

WTI slipped back below $70 in afternoon trading as tensions eased across markets. Unpleasant as it is to watch two sides trade missiles on a sustained basis, so long as the Straits of Hormuz remain quiescent it is hard to envisage a scenario where Friday’s gains can be sustained.

Author

Chris Beauchamp

EUR/USD challenges 1.1800, two-week lows

EUR/USD remains on the defensive, extending its leg lower to the vicinity of the 1.1800 region, or two-week lows, on Tuesday. The move lower comes as the US Dollar gathers further traction ahead of key US data releases, inclusing the FOMC Minutes, on Wednesday.

GBP/USD looks weaker near 1.3500

GBP/USD adds to Monday’s pessimism and puts the 1.3500 support to the test on Tuesday. Cable’s marked pullback comes in response to extra gains in the Greenback while disappointing UK jobs data also collaborate with the offered bias around the British Pound.

Gold loses further momentum, approaches $4,800

Gold recedes to fresh two-week troughs around the $4,800 region per troy ounce on Tuesday. The precious metal builds on Monday’s downtick following a marked rebound in the US Dollar and mixed US Treasury yields across the board.

Crypto Today: Bitcoin, Ethereum, XRP upside looks limited amid deteriorating retail demand

The cryptocurrency market extends weakness with major coins including Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) trading in sideways price action at the time of writing on Tuesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.