Poetic justice? Global stocks plunging on Gaza attacks
Major global stock markets fell and bond prices ralliedas worries over conflict in the Gaza Strip and Ukraine raised uncertainty for investors and kept them away from riskier assets.
The safe-haven yen also inched up and gold prices rose above $1,300 an ounce as the market focused on increased turmoil in the Middle East and tensions following last week’s downing of a Malaysian jetliner over Ukraine.
Israeli jets, tanks and artillery continued to pound Gaza as the death toll from a two-week conflict topped 500. Reports that Ukrainian forces were moving into the eastern city of Donetsk added to concerns that the conflict in one of Europe’s biggest countries may escalate.
Shocks to the system from Ukraine and Israel’s ground invasion of Gaza come at a time when markets have been worried about economic growth on both sides of the Atlantic and digesting second-quarter earnings reports.
The US and the EU recently announced further economic sanctions against Russian interests before the jet was shot down.
But Germany and other European Union members have taken a more cautious line on moves against Russia than the US, mindful of the damage an exchange of sanctions with one of their main energy providers could do to Europe’s economy. The Bundesbank said on Monday the German economy probably stagnated in the second quarter.
The situations in Gaza and Ukraine “are both quite serious, but at this point unlikely to derail the US economy,” said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.
The Dow Jones industrial average fell 70.00 points, or 0.41 percent, at 17,030.18.
The Standard & Poor’s 500 Index was down 7.87 points, or 0.40 percent, at 1,970.35.
The Nasdaq Composite Index was down 15.07 points, or 0.34 percent, at 4,417.07.
MSCI’s All-World Index was down 0.3 percent, while European stocks were down 0.5 percent.
The overseas headlines overshadowed some upbeat US earnings.
So far this reporting period, 68 percent of S&P 500 companies are beating Wall Street’s profit expectations, according to Thomson Reuters data. That is above the 63 percent average since 1994.
In the foreign exchange market, the greenback was a tad lower against the yen at 101.27 yen, while the dollar also slipped against the Swiss franc, last trading at 0.8982 franc.
US oil prices were higher after Iran and six world powers failed to meet a July 20 deadline for a settlement over Tehran’s nuclear activities.
US crude was up 83 cents at $103.99, while Brent crude oil was down 28 cents at $106.94 a barrel.
- United Arab Bank makes AED250,000 contribution to Al Thiqah Club for the Handicapped
- Opening up: is Saudi Arabia's stock market ready for an upgrade?
- Severe symptom of a savings gap? Turkey leads Europe in credit card debt
- Gulf stocks facing some serious 'downward pressures'
- Long-anticipated hike: Dollar on track for best annual gain in nine years