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2026-04-06 16:27:02
[Iran's Missile Retaliation, Trump's Threat to Bomb Power Plants, Oil Prices Tear Apart, Bond Markets Plunge, Gold Sells Off] ⑴ Following Trump's escalating threats against Iran, Iran launched missiles and drones at Gulf states and Israel, escalating concerns about supply disruptions in the Middle East. Crude oil futures reacted mixed: in Asian trading, Brent crude futures for the near month rose 0.5% to $109.57 per barrel, while West Texas Intermediate crude futures for the near month fell 0.2% to $110.88 per barrel. ⑵ Trump threatened to destroy all of Iran's power plants if Iranian leaders did not agree to reopen the Strait of Hormuz by Tuesday night, extending the deadline from Monday to Tuesday. Approximately 20% of global oil shipments pass through the strait, keeping the risk of escalation high. ⑶ A senior foreign exchange analyst at MUFG stated that oil prices are likely to remain high with risks skewed to the upside. Market concerns that rising oil prices could exacerbate inflation, prompting central banks to raise interest rates more quickly or pause rate cuts for a longer period, put downward pressure on government bond prices. (4) The yield on 10-year Japanese government bonds rose to 2.400%, the highest intraday level since February 1999, while the yield on 10-year US Treasury bonds rose 4 basis points to 4.3575%. Bond yields move inversely to prices. The UOB Global Economics team stated that tensions in the Middle East have disrupted stable inflation, posing a risk of supply disruptions. (5) Spot gold fell 0.4% to $4,657.86 per ounce. Gold prices experienced significant volatility as investors favored assets like the US dollar due to its greater liquidity and convertibility, and rising bond yields reduced gold's appeal as a non-interest-bearing asset. Meanwhile, stocks rose in thin holiday trading.
