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Israel-Hamas War: Can More Risk Off Panic Moves Hit Markets?
Is another risk-off panic movement in the markets possible in the wake of the Israel-Hamas war? According to a report from finanzmarktwelt.de, the current trends on the stock markets are clearly pointing south. The DAX trend since the outbreak of the Israel-Hamas war shows current weakness with only a good 100 points above the low at the beginning of the week. Further negative news could quickly lead to a break below this low and a further downtrend. Other markets such as gold and oil also offer traders the prospect of another “risk off” trade. Israel and the US have carried out attacks on various bases and facilities in recent days, prompting...
Israel-Hamas War: Can More Risk Off Panic Moves Hit Markets?
Is another risk-off panic movement in the markets possible in the wake of the Israel-Hamas war? According to a report from finanzmarktwelt.de, the current trends on the stock markets are clearly pointing south. The DAX trend since the outbreak of the Israel-Hamas war shows current weakness with only a good 100 points above the low at the beginning of the week. Further negative news could quickly lead to a break below this low and a further downtrend. Other markets such as gold and oil also offer traders the prospect of another “risk off” trade.
Israel and the US have carried out attacks on various bases and facilities in recent days, highlighting the volatile situation in the region. In response, the US has now attacked two facilities in eastern Syria. US Defense Secretary Lloyd Austin emphasized that these attacks were only in self-defense and were not related to the war between Israel and Hamas. Nevertheless, it shows how quickly the conflict can develop into a major conflagration. The US has increased its troops in the Middle East and the latest attacks are believed to be the first offensive since Hamas invaded Israel in October.
Tensions between the US and Iran have also increased and Iran's foreign minister warned that the US would not escape unscathed if the conflict continued to spread.
According to the report from finanzmarktwelt.de, it is possible that the situation will worsen further and lead to another “risk off” trade. Investors could increasingly flee to “safe havens” such as the Swiss franc, the dollar and gold. The price of gold is currently at $1,988 per ounce and could quickly reach and exceed $2,000 if there is further escalation in the Middle East. The price of oil could also rise again amid fears of a supply crisis. Although it has given up its Middle East risk premium in recent days, rising prices could be priced in again.
The stock markets are currently not only suffering from geopolitical uncertainties, but also from shaky quarterly figures from tech companies and high bond yields. The effects of the current situation in the Middle East could further weigh on the market.
Source: According to a report from finanzmarktwelt.de
Read the source article at finanzmarktwelt.de