On Friday, the prices of oil, U.S. Treasuries, and gold all increased, withcrude oil experiencing a significant 6% surge. This rise was primarily dueto safe-haven buying triggered by the escalating conflict in the MiddleEast.
Israel had urged civilians to evacuate the northern Gaza Strip,contributing to this sentiment. Over the past week since the conflict’sonset, Brent crude oil has surged by 7.5%, marking its most substantialweekly gain since February.
Spot gold added 3.2% on the day to $1,928.99 an ounce, and had its biggestweekly percentage gain since March.
This was driven by investors factoring in the potential for an escalationin the world’s leading oil-producing region. Despite encouraging resultsfrom major U.S. banks, the S&P 500 concluded the day with losses, markingthe unofficial beginning of the third-quarter reporting period for S&P 500companies.
Weak U.S. consumer data also had a negative impact on stocks, as consumersentiment deteriorated in October, with households anticipating higherinflation in the coming year.
JPMorgan saw its shares rise by 1.5% following a 35% profit increase fromthe same quarter the previous year. In response to severe attacks by Hamasmilitants over the weekend, the Israeli military called for civilians toleave Gaza City in anticipation of a possible ground invasion.
The yield on 10-year Treasuries decreased by 8.2 basis points to 4.629%.Spot gold recorded a 3.2% increase on the day, reaching $1,928.99 perounce, and achieved its most substantial weekly percentage gain sinceMarch.
Brent futures climbed by $4.89, or 5.7%, closing at $90.89 per barrel,while U.S. crude increased by $4.78, or 5.8%, reaching $87.69 a barrel.Marvin Loh, senior global macro strategist at State Street in Boston,explained that the objective was to invest in a secure asset that wouldperform well in the event of a worsening ground assault situation over theweekend.
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He expressed concerns about the increasingly disheartening developments inthe Middle East, which seemed to have the potential to deteriorate further.
Regarding stocks, the Dow Jones Industrial Average rose by 39.15 points,or 0.12%, to 33,670.29. The S&P 500, on the other hand, experienced a lossof 21.83 points, or 0.50%, closing at 4,327.78, and the Nasdaq Compositedropped by 166.99 points, or 1.23%, to 13,407.23.
The pan-European STOXX 600 index lost 0.98%, and MSCI’s global stocks gaugeshed 0.81%. The U.S. dollar also benefited from safe-haven buying driven bythe escalating Middle East conflict. The dollar index, which measures theU.S. currency against six major peers, increased by 0.11% to 106.63.
The index had risen by 0.8% the previous day, marking its most substantialone-day increase since March 15, and was on track to finish the week with a0.5% gain.
Earlier data on Friday revealed that China’s consumer prices remained flatin September, while factory-gate prices decreased at a slower pace,indicating persistent deflationary pressures. Additionally, both exportsand imports continued to contract, albeit at a slower rate.