US President Donald Trump’s green light for strikes on Iranian nuclear strikes over the weekend has put markets on edge as they prepare to open this week, with oil prices firmly in the spotlight.
Australian futures were already pointing to a soft start to the week for the ASX, following a broadly weaker Friday session for Wall Street before the Sunday strikes.
Meanwhile, Tesla’s Robotaxis have launched in Austin, Texas with a flat fee of US$4.20.
And ASB Bank has a new chief investment officer, hiring former Fisher Funds investment manager Frank Jasper to work with the bank’s partner, BlackRock, to over sees its $18.17 billion of KiwiSaver funds under management.
No tacos here
US President Donald Trump surprised markets after approving strikes on Iranian nuclear sites over the weekend. The White House is urging Iran to resume peace talks after the attacks, indicating it isn’t interested in a regime change after the bombing.
Brent crude oil prices have gained almost 21% so far this month and futures are pointing to another 0.4% increase to US$77.32 a barrel, as traders weigh up the impact of the strike on energy markets.
Big energy companies have also enjoyed gains this month, tracking oil prices higher, with Exxon Mobil up 12% so far this month, Chevron gaining 9.4%, BP up 6.9% and Shell advancing 7.9%.
“The further escalation in the Middle East conflict over the weekend, after the US attacked Iranian nuclear sites, increases the likelihood of a further spike in oil prices and will weigh on investor risk appetite,” Bank of New Zealand senior interest rate strategist Stuart Ritson said in a note.
The kiwi dollar traded at 59.63 US cents at 7am in Auckland from 60.05 cents on Friday, when New Zealand markets were closed for the Matariki public holiday.
The strikes haven’t disrupted shipping routes yet, with Maersk and Hapag-Lloyd both continuing to sail vessels through the Strait of Hormuz.
More defence spending
The heightened tensions in the Middle East came ahead of the NATO summit in the Hague, where Spain is holding out on hiking its defence spending to 5% of gross domestic product.
Australian futures were pointing to a 0.2% decline before the Sunday strike.
Meanwhile, Tesla is pressing ahead with its Robotaxi launch in Austin, Texas, with chief executive Elon Musk saying on his X social media platform that the autonomous taxi service will charge a flat fee of US$4.20 a ride.
Federal Reserve board governor Chris Waller said the US central bank could cut rates as soon as July, with inflation from the White House’s tariffs expected to be short-lived. Waller’s view is a minority among the federal market open committee.
New Zealand markets return from the long weekend today, with a number of the dual-listed blue chip companies gaining on Friday during the ASX session. Among those was Fletcher Building, which reached a settlement with the New Zealand Transport Agency and Northern Express Group over the Puhoi to Warkworth road north of Auckland.
Fletcher will update investors at a briefing on Tuesday.
No local data is scheduled for today.
And ASB Bank has appointed Frank Jasper as its chief investment officer, who will work closely with the bank's investment partner BlackRock in overseeing its funds management arm. Jasper was previously the chief investment officer at Fisher Funds before departing in 2021. He's been on ASB's investment committee since 2022.
Reporting by Paul McBeth. Image from Timothy Newman on Unsplash.
