Global Markets: Oil gains after Iran tensions, stocks at seven-week highs
By Lewis Krauskopf NEW YORK (Reuters) - Oil prices built on recent gains on Friday on fears any U.S. military attack on Iran would disrupt flows from the Middle East, while a gauge of global stock markets hovered near seven-week highs following a run spurred by optimism over monetary policy. Gold prices climbed to near six-year highs and were on track for their best week in three years
By Lewis Krauskopf
NEW YORK (Reuters) - Oil prices built on recent gains on Friday on fears any U.S. military attack on Iran would disrupt flows from the Middle East, while a gauge of global stock markets hovered near seven-week highs following a run spurred by optimism over monetary policy.
Gold prices climbed to near six-year highs and were on track for their best week in three years.
Central banks have dominated economic news this week, with the Federal Reserve signaling the potential for a U.S. interest rate cut later this year and the European Central Bank hinting at stimulus measures.
MSCI's gauge of stocks across the globe shed 0.09%, after a day earlier reaching its highest level since May 1.
U.S.-China trade tensions were also in focus ahead of an expected meeting between the countries' two leaders next week.
U.S. stocks had gained steam after a Wall Street Journal report said U.S. Vice President Mike Pence will postpone his planned speech on China policy next week to avoid stoking additional tensions ahead of President Donald Trump's planned meeting with Chinese President Xi Jinping.
The main U.S. indexes were little changed in afternoon trade. The Dow Jones Industrial Average rose 43.72 points, or 0.16%, to 26,796.89, the S&P 500 lost 0.77 points, or 0.03%, to 2,953.41 and the Nasdaq Composite dropped 7.80 points, or 0.1%, to 8,043.54.
The pan-European STOXX 600 index lost 0.36%.
Trump said he had aborted a military strike on Iran because such a response to Tehran's downing of an unmanned U.S. surveillance drone would have caused a disproportionate loss of life.
Spot gold added 0.6% to $1,395.94 an ounce, surpassing the key $1,400 level during the session.
"There is a perfect mix of ingredients for gold's rush to the top – a weak macroeconomic environment, low bond yields, soft dollar and rising geopolitical tensions," said Howie Lee, an economist at OCBC Bank.
Oil futures rallied on fears of a disruption to flows in the Middle East, which provides more than a fifth of the world's oil output.
"A lot of the oil produced in the world comes from very troubled areas, and occasionally we get reminders of that," said Gene McGillian, vice president at Tradition Energy in Stamford, Connecticut.
U.S. crude rose 0.68% to $57.46 per barrel and Brent was last at $65.15, up 1.09% on the day.
Government bond yields in the United States and Europe rose but remained near record or multi-year lows after the dovish statements from the central banks.
Benchmark 10-year U.S. Treasury notes last fell 19/32 in price to yield 2.0661%, from 2.001% late on Thursday.
The dollar index, which measures the greenback against a basket of currencies, fell 0.25%, with the euro up 0.46% to $1.1343.
The yen rose to a five-month high versus the dollar during the session the tensions between Iran and the United States.
(Additional reporting by Jessica Resnick-Ault in New York, Abhinav Ramnarayan in London, Eileen Soreng in Bengaluru, editing by Hugh Lawson and Susan Thomas)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.