Dow, S&P 500, Nasdaq wobble, oil prices rise as Wall Street weighs Iran’s next move

Wall Street closely see the escalating tensions in the Middle East after president Trump confirmed that the United States launched a surprise blow to Iranian nuclear sites late on Saturday, which represents the country’s official entry into the two -week conflict.

The markets were mostly fixed in the aftermath of the escalation, although American stock futures declined in all fields when trading was opened on Sunday evening.

In addition, Bitcoin (BTC-Us), which is often seen as a risk appetite scale, has decreased, more than 1.6 % for trading about $ 100500 per coin. Futures in WTI (CL = F) and Brent (BZ = F) jumped, and traded near $ 76 and $ 79 a barrel, respectively, where uncertainty over the potential closure of the embarrassment of the hormone despite the ongoing threats from Iran.

The latest increase in the third week of the gains in a row in Friday oil.

“We will not be surprised by the vision of this spark in the risk reaction in American stocks and we will see futures closely on Sunday evening and Monday morning,” Lori Calvasina, head of the American stock strategy research at RBC Capital Markets, wrote in an evening note on Sunday to clients.

Calvasina added: “It was the case and we are still believing that the longer the conflict becomes and wider, the more difficult it is for us,” she added. “These escalators come in a difficult time for us, as the S&P 500 looked somewhat valuable to us (may be a little exaggeration) from a basic perspective, with more space for running than the perspective of feelings.”

The analyst said that her three main fears include: First, it is a risk that the high uncertainty in national security can affect stock assessments; Second, the possibility of renewing geopolitical tensions can disrupt the recovery in the feelings that started after the first levels of April tariff; And thirdly, the possibility of an increase in oil prices, which may enhance inflation fears.

In terms of sectors, energy (Xle) tends to excel when oil prices rise, while telecommunications services (XLY) and telecommunications services (XLC), along with entertainment, media and interactive media, tend to undermine the broader market.

The Citi Stuart Kaiser analyst agreed that high oil prices remain “a” geopolitical risk channel to influence stock markets “, with raw prices” much higher than $ 80 for barrels “as a critical threshold of anxiety.

Kaiser added that the options markets are now 10 %, that the oil rises by 20 % during the next month, up from only 2.5 % two weeks ago, which reflects the risks of the stabilization tail with the deepening of the conflict.

However, the analyst pointed to the flexibility in stocks amid volatility, saying: “The markets that work through extreme oil fluctuations and unstable geopolitical headlines to spread the risk week.”