by Mara Vilcu
(Reuters) – European scholarships finished in a clear drop on Friday after the Israeli strikes overnight on Iranian nuclear installations made the oil prices flambé and caused the investor rush to the refuge values.
In Paris, CAC 40 lost 1.04% to 7,684.68 points. In Frankfurt, the Dax abandoned 1.14% and in London, the FTSE 100 fell 0.39%.
The Eurostoxx 50 index abandoned 1.35%, the FTSEURofirst 300 lost 0.91%and the Stoxx 600 fell by 0.98%.
Over the week, the Stoxx 600 abandoned 1.66% and the CAC 40 lost 1.54%.
The Israeli army bombed dozens of targets in Iran on Thursday to Friday, including nuclear sites and ballistic missile factories, and killed military commanders and scientists.
On Friday, Donald Trump urged Iran to conclude an agreement on his nuclear program under penalty of undergoing new attacks even harder than those inflicted in the morning by Israel.
Iran, which denies any ambition to acquire nuclear weapon, promised an implacable response to this attack, to which the United States, engaged in negotiations with Tehran on its nuclear program, said that they are not associated while many countries, including France, called for appeasement.
Climbing in the Middle East, an important region for oil production, accentuates the uncertainty that reigns in the markets while the global economy undergoes increased pressure due to aggressive and unpredictable trade policies of US President Donald Trump.
“Geopolitical escalation adds an additional stratum of uncertainty to an already fragile climate,” said Charu Chanana, chief investment strategist at Saxo. According to her, crude oil and sheltering assets will remain on an ascending trajectory if the tensions continue to intensify.
Oil prices are flying away on Friday, reaching their highest level for several months, while tensions in the Middle East arouse concerns about the disruption of the supply.
The Brent advances from 5.8% to $ 73.38 per barrel and light American crude (West Texas Intermediate, WTI) takes 6.06% to $ 72.16.
VALUES
Totalnergies won 0.11%, helped, like the rest of the oil sector, by the rise in crude prices. In London, Shell increased by 0.63%.
Large European defense companies, such as the British Bae Systems and the Swedish SAAB AB earned 2.87% and 2.82% respectively, supported by the climbing of tensions in the Middle East.
The airline sector suffered, however, when many airlines have stopped flying over the airspace above Israel, Iran, Iraq and Jordan on Friday. Air France-KLM lost 4.74% and Lufthansa 2.77%.
A Wall Street
At the time of the closing in Europe, the Dow Jones abandons 0.87%, the Standard & Poor’s 500 0.36%and the Nasdaq Composite 0.46%.
The indicators of the day
Industrial production in the euro zone has decreased more than expected over one month in April, show the data published Friday by Eurostat, the Statistical Office of the European Union.
German inflation calculated according to European standards (IPCH) slowed down to 2.1% over one year in May, in accordance with preliminary data and analysts’ consensus, show the final data of the Federal Statistics Office on Friday.
Changes
The US dollar is appreciated on Friday in the face of the main currencies, including the euro and the yen, the markets looking for refuge values in a context of increasing geopolitical tensions following the trigger of a conflict between Israel and Iran.
The dollar earns 0.11% against a basket of reference currencies.
The euro lost 0.17% to 1.1563 dollars.
RATE
US bond yields are in small increases after dropping earlier during the day.
The yield of Treasuries at ten years earns 7.1 base points at 4.4284%. The two years advances 6.5 base points at 3.9706%.
In Europe, the yield of the German Bund at ten years has advanced 5.8 base points to 2,5360%. The two years earned 4.1 base points at 1.8540%.
Metals
The price of gold is climbing, investors turning to the refuge values after the Israeli attack against Iran.
Gold in cash advances from 1.21% to 3,425.99 dollars an ounce.
To be continued on June 16:
(Some data may accuse a slight offset)
(Written by Mara Vîlcu, edited by Blandine Hénault)
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