Global markets are following a positive trend due to the declining oil prices and increasing risk appetite after US President Donald Trump stated that the war with Iran will end very soon.
Optimism that the US and Israel’s attacks on Iran will end soon has reduced the risk perception in global markets. Trump’s statement that the war with Iran will end very soon alleviated the fear of a long-term war and increased investor confidence.
These developments and the decline in oil prices brought relief to the stock markets, which were shaken by the increase in energy costs.
In a telephone interview with the American CBS News channel, Trump stated that he thought the war was largely completed and that the other side did not have a navy, communications or air force.
Giving important messages regarding the Strait of Hormuz, Trump stated that he was “considering taking control of the Strait.” Regarding rising energy prices, Trump emphasized that they also lifted some oil-related sanctions to reduce prices.
Stating that they are focused on maintaining the flow of energy and oil to the world, Trump said, “I will not allow a terrorist regime to take the world hostage and try to stop the global oil supply. If Iran tries to do this, it will be responded to much harsher.” he said.
On the other hand, Russian President Vladimir Putin, speaking at the meeting held in Moscow with Russian government officials regarding the developments in the energy sector, stated that oil production in the region may end completely due to the closure of the Strait of Hormuz, and that they are ready to work again with Europe in the field of energy.
On the other hand, Iranian Revolutionary Guards Army Spokesperson Ali Muhammed Naini reacted to Trump’s statements that “Iran’s power is over.” Arguing that Trump “is trying to apply psychological pressure against Iran with lies and deception”, the Iranian Spokesperson said, “Iran is resisting the attacks of the USA and Israel with courage and strong will. We are continuing the war with all our strength, and Iran will determine the end of the war.” he said.
Trump also stated that if Iran blocks the flow of oil through the Strait of Hormuz, the United States will respond “20 times harder” than previous attacks on Iran.
Following these statements, declines in index futures contracts in the USA came to the fore, while geopolitical tensions continued to pose a risk for the markets.
The rapid increase in freight prices and the rapid increase in oil prices following the attacks launched by the USA and Israel against Iran on February 28 brought concerns about inflation, debt and the sustainability of energy flows all over the world.
Analysts stated that Trump’s statements relieved the markets somewhat, but geopolitical risks still continue.
On the macroeconomic data side, the short-term median inflation expectation covering the next 12 months in the USA decreased by 0.1 points to 3 percent last month.
International credit rating agency Fitch Ratings also reported that public finance institutions in the USA face increasing cyber risk due to the Iran conflict.
With these developments, the US 10-year bond interest is at 4.12 percent and the dollar index is on a horizontal course at 98.9.
An ounce of gold is traded at $5,171 with an increase of 0.5 percent.
The barrel price of Brent oil, which approached 120 dollars yesterday and dropped by around 31 percent to 82.7 dollars after Trump’s statements, is today at 90.3 dollars, with an increase of 4.2 percent.
The New York stock market finished the day positively after Trump’s statements. It is predicted that if oil prices do not remain at very high levels for a very long time, a recovery trend may come to the fore in the New York stock market.
With these developments, the Dow Jones index gained 0.5 percent, the S&P 500 index gained 0.83 percent and the Nasdaq index gained 1.38 percent. Index futures contracts in the USA started the day with a decline.
European stock markets followed a sales-oriented trend yesterday due to the escalation of tension in the Middle East and sharp increases in oil prices.
The blockage of energy corridors by the war in the Middle East and the jump in natural gas prices increased the interest rate pressure on the European Central Bank (ECB). According to the pricing in the money markets, the ECB is expected to make two 25 basis point interest rate increases by the end of the year. The bank is expected to make its first interest rate increase by June.
On the other hand, French Economy Minister Roland Lescure announced that the G7 countries have not yet taken a final decision on releasing their national oil reserves, but they are ready to use “all kinds of tools, including the use of reserves” to stabilize the market.
Selling pressure on European stock markets was especially concentrated in the aviation and mining sectors. British mining company Anglo American lost 3.2 percent, and aerospace and defense company Rolls-Royce lost 2 percent. Shares of the German airline company Lufthansa Group lost 6.14 percent.
Contrary to the general downward trend in the market, shares of energy companies benefiting from high oil prices closed the day with gains. BP gained 2.3 percent in London and Shell gained 2.5 percent in Amsterdam.
Shares of German Siemens Energy, on the other hand, finished the day down 0.7 percent due to profit sales following their recent rapid rise.
According to data announced in the region, industrial production in Germany decreased by 0.5 percent and factory orders decreased by 11.1 percent in January. Market expectation was that industrial production would decrease by 1 percent monthly in January and factory orders would increase by 6.4 percent.
On the other hand, the escalating conflicts in the Middle East due to the US and Israel’s attacks on Iran caused investors’ optimism about the economic outlook of the Eurozone to decrease.
Market research center Sentix announced the Eurozone General Investor Confidence Index data for March. Accordingly, the index, which was 4.2 points in February, decreased by 7.3 points this month to the previous 3.1 points. The expectation for the index was that it would fall to minus 5 in March.
Meanwhile, German Chancellor Friedrich Merz announced that he was “concerned” about the negative effects of rapidly rising energy costs due to the conflicts in the Middle East on the German economy.
On the other hand, in Germany’s Baden-Württemberg State Assembly election, while the Green party came first according to the exit poll, it is predicted that this will make the job of German Chancellor Friedrich Merz difficult and may cause political uncertainty in the country.
Selling pressure is prominent in the bond market in Europe. The German 2-year bond rate increased by 16 basis points to 2.47 percent yesterday, and the UK 2-year bond interest increased by 36 basis points to 4.23 percent. These pricings reveal expectations that the central banks of developed countries will increase interest rates.
With these developments, the FTSE 100 index in England lost 0.34 percent, the FTSE MIB 30 index in Italy lost 0.29 percent, the CAC 40 index in France lost 0.98 percent, and the DAX 40 index in Germany lost 0.77 percent. Index futures contracts in Europe started the day with a mixed trend.
Asian stock markets are trending positively with the expectation that the war in the Middle East will end very soon. The good macroeconomic data announced in China and Japan also contributed to the increase in risk appetite in Asian markets.
In China, exports for the January-February period increased by 21.8 percent on an annual basis and imports increased by 19.8 percent on an annual basis, exceeding expectations. Good foreign trade figures revealed that the world’s second largest economy continues to remain strong despite ongoing global trade tensions and customs duties.
On the other hand, in Japan, the Gross Domestic Product (GDP) for the 4th quarter increased by 0.3 percent compared to the previous quarter and 1.3 percent on an annual basis, exceeding expectations.
While the data in question reveals that the Japanese economy shows some resistance, it is predicted that this trend may provide the Bank of Japan (BoJ) with more room to increase interest rates further.
With these developments, the Nikkei 225 index in Japan increased by 2.3 percent, the Hang Seng index in Hong Kong increased by 1.6 percent, the Shanghai composite index in China increased by 0.4 percent and the Kospi index in South Korea increased by 4.5 percent.
BIST 100 index at Borsa Istanbul, which followed a sales-oriented trend yesterday, finished the day at 12,702.00 points, losing 0.71 percent of its value.
The April futures contract based on the BIST 30 index in the Borsa Istanbul Futures and Options Market (VIOP) was traded at 15,348.00 points in the last evening session, with an increase of 2.86 percent compared to the normal session closing.
While Dollar/TL completed the day yesterday at 44.0390 with a 0.1 percent decrease, today it is traded at 44.0730 at the opening of the interbank market, 0.1 percent above the previous closing.
On the other hand, Halkbank announced that it was decided to sign a Postponement of Prosecution Agreement with the Southern New York District Attorney’s Office of the US Department of Justice in order to end the criminal case, which has been ongoing in the USA since 2019, through reconciliation.
Within the scope of the settlement agreement in question, the bank will not pay any judicial or administrative fines.
Analysts stated that industrial production in the country, foreign trade balance in Germany and second-hand house sales in the USA will be followed abroad today, and noted that technically, 12,600 and 12,500 points in the BIST 100 index are in a support position, while 12,800 and 12,900 points are in a resistance position.
