World equities index rises, oil gains on supply concerns
MSCI’s gauge of stocks across the world added 4.71 points, or 0.42%, to 1,121.57
MSCI’s world equities index rose on Tuesday, while oil prices gained on supply concerns as Iran and U.S. exchanged strikes.
MSCI’s gauge of stocks across the world added 4.71 points, or 0.42%, to 1,121.57.
Earlier, the pan-European STOXX 600 index finished up 0.17%, recovering from losses of as much as 0.9%.
After surging 9% on Monday, oil’s gains were more modest on Tuesday, as the U.S. president backed away from a proposal to charge a 20% transit fee for the vital Strait of Hormuz, saying that he would instead seek investment deals with Gulf states.
But Iran’s Deputy Foreign Minister Kazem Gharibabadi told state TV that the strait was part of Iran’s national security.
Brent settled at $84.73 per barrel, up 1.7%, or $1.43, after both hit a nearly one-month high earlier in the day.
Shares of big U.S. banks rallied following results that showed the major firms were boosted by strong trading revenue and corporate deal-making. JPMorgan Chase reported a record quarterly profit, pushing its shares to an all-time high, while Goldman Sachs, Bank of America and Citigroup all exceeded U.S. stock market’s profit estimates.
IBM shares finished down 25% after it warned it would take a big earnings hit in the second quarter as it failed to keep pace with a shift in corporate spending from software to data-centre infrastructure. The technology company was the biggest drag on the S&P 500.
While equity traders for now shrugged off the latest Middle East hostilities, Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder, said the war was still an overhang for the stock market.
Right now the market is discounting this issue but it’s lingering. It’s dampening market strength from the very strong results we saw from financial companies, he said, adding that “the favourable CPI number we see could be very different next month given what we’re seeing in the oil market.”