(News Bulletin 247) – Stock markets experienced a rapid reversal and oil soared as several news agencies reported an imminent ballistic missile attack from Tehran against Israel.
Geopolitics comes to remember the market well this Tuesday. A little after 3:30 p.m., the European and American stock indices experienced a fairly sudden downward movement. For example, the CAC 40, which was moving a little in the green, turned around and lost 1% around 4:20 p.m. The S&P 500 fell, dropping 1.1% at the same time.
This renewed tension came as several news agencies, such as Bloomberg and AFP, reported that the United States had indications that Iran was preparing to launch “an imminent ballistic missile attack” against Israel. Both agencies cited an unnamed senior U.S. official.
According to AFP, Hezbollah, a Lebanese terrorist group supported by Iran, also claimed to have targeted an air base near Tel Aviv.
Air France-KLM falls
This information revives fears of an escalation of tensions in the Middle East with, as is often the case, fears over oil production.
Around 4:20 p.m., oil rose sharply following this information. The December contract on North Sea Brent advanced 2.87% to $73.72 per barrel while that of November on WTI listed in New York increased by 3%.
This rise in black gold penalizes airlines whose fuel bill represents one of the main expense items. Air France-KLM lost 6.7%, Lufthansa lost 3% and IAG lost 3.9%.
Conversely, defense groups are supported by geopolitical tensions. Thales is leading the CAC 40 with an increase of 2.3%, BAE Systems takes 3% in London and Rheinmetall, which supplies armored vehicles to the German army, advances 4% in Frankfurt.
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