By Dow Jones Newswires staff
Global stock markets fell and oil prices surged after Israel launched a wide-ranging attack on Iran's nuclear facilities, rattling markets and sending investors fleeing into safe-haven assets.
Israel said the attack targeted Iran's nuclear program and other military sites, as well as Iranian military commanders and nuclear scientists. Dozens of planes wrapped up the first wave of the attack before dawn Friday, Israel said.
Early in Europe, Brent crude futures rose 5.5% to $73.18 a barrel while the U.S. oil gauge West Texas Intermediate was up 5.5% to $71.76 a barrel, both benchmarks having surged as much as 13% earlier in the trading session before paring gains.
European benchmark natural gas prices based on the Dutch TTF futures contract were up 2.9%.
Any disruptions to Iranian oil supply could prompt the Organization of the Petroleum Exporting Countries to ramp up production more quickly, ING's head of commodity strategy Warren Patterson said. However, its ability to act as a buffer would likely be limited if tensions escalate further. "If we are seeing disruptions to oil flows through the Strait of Hormuz, this spare production capacity will be of little help to the global oil market," he said. "Given the importance of the Strait, any disruptions would lead to a more globally coordinated response to ensure that energy flows at this chokepoint are not severely disrupted."
Safe-haven assets such as gold, government bonds, the Japanese yen and the Swiss franc strengthened as the attack spurred investors to pare down risk, as U.S. stock futures sank.
Spot gold rose 1.6% to $3,438.89 per troy ounce and U.S. Treasury yields fell to a one-month low; the yield on the 10-year was down to 4.314% before recovering to trade at 4.325% early in Europe, still down 3 basis points on the day, according to Tradeweb.
Defense stocks and oil and gas sector stocks gained. Britain's BAE Systems rose 3.5% shortly after the opening bell, while Germany's Rheinmetall, Hensoldt and Renk Group all gained 2% or more. Earlier, South Korean guided-missile maker LIG Nex1 surged 14%.
Equinor shares led the European energy majors higher with a gain of 3.6%. Shares in TotalEnergies, Shell and BP were all nearly 2% higher while Norway's oil-heavy OBX index rose 1.1% at the open.
Gold miners also gained. Harmony Gold and Gold Fields rose 2.1% and 1.5%, respectively, while AngloGold Ashanti gained 1.8% at the market open in Johannesburg.
The DXY dollar index against a basket of major currencies was up 0.3% to 98.249, and could recover further if geopolitical tensions persist for some time following Israel's strike on Iran's nuclear facilities, ING analyst Francesco Pesole said in a note. "The risks now point more definitively towards a prolonged period of tension, in contrast to recent episodes," he said.
U.S. stock futures, meanwhile, were down between 1.2% and 1.5%. In Europe, the Stoxx Europe 600 dropped 1% in morning trading. France's CAC 40 decreased 1.2% and Germany's DAX fell 1.4%. The U.K.'s FTSE 100 lost 0.6%. Stock markets in Asia closed lower.
Write to Barcelona Editors at barcelonaeditors@dowjones.com
(END) Dow Jones Newswires
June 13, 2025 04:55 ET (08:55 GMT)
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