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Business

Markets nervous, but not hectic after airstrike

April 7, 2017

Financial markets around the world haven’t shown any signs of overreaction to the US airstrike on Syria. Asian markets largely pared initial losses. Germany's blue-chip Dax index opened down only marginally.

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Frankfurt Stock Exchange
Image: picture-alliance/dpa/Rumpenhorst

Germany's benchmark index of 30 leading companies opened only 0.5 percent lower on Friday, dropping to 12.175 points in what may have been a cautious reaction to the US airstrike on Syria.

No big movement is expected on the Frankfurt Stock Exchange before new job figures are released in the US later in the day.

"It's now a matter of analyzing the political and economic fallout of the US airstrike," QC Partners portfolio manager Thomas Altmann said in a statement, adding that the outcome of talks between the US and Chinese presidents would probably have a far greater impact on financial markets.

Oil prices rallied amid fears that an escalation of the conflict in the crude-rich Middle East could disrupt supplies. Both main contracts jumped more than two percent to their highest levels in a month. After benchmark contract Brent struck $56.08 per barrel and WTI $52.94 (49.85 euros), gains were pared through the day.

Asia upbeat

Asian stocks presented a largely positive picture on Friday, with the Nikkei in Tokyo ending the day higher (+0.4 percent) after initially dropping to a four-month low.

US fires cruise missiles on Syria – the first reactions

The broader Topix closed 0.6 percent higher, with Shanghai also in positive territory and unfazed by the US airstrike.

Nevertheless, the latest developments in the Syria conflict prompted investors to shift more of their money toward safe-haven assets. Gold was the big winner, reaching the highest value since November of last year.

Also in a move to cushion the impact of potential market turbulence, investors strengthened their yen positions, with the US greenback losing over 0.5 percent against the Japanese currency.

hg/jd (AFP, dpa, Reuters)