Berliner Boersenzeitung - Oil rises on Trump's Iran threats, stocks mixed

European stocks rose but Wall Street's major indexes closed mostly lower as markets cast a wary eye on Trump's comments about negotiations to end the fighting.

Trump expressed confidence that a negotiated settlement would soon be reached but warned that if it was not -- or if Iran continued to block the Strait of Hormuz to most sea traffic -- US forces would blow up Kharg Island and all of Iran's oil wells and electricity generation.

Brent North Sea crude, the international benchmark, jumped to almost $117 per barrel early in the trading session before closing at $112.78.

The West Texas Intermediate gained 3.3 percent to $102.88 a barrel, closing above $100 for the first time since the war started.

US stocks started the day in partial "rally mode" as Trump "made a comment that was meant to be taken positively," said Sam Stovall of CFRA Research.

"But Wall Street has learned by now that you really don't believe everything you read," he added, noting that markets still have room to decline further before bouncing back.

IG analyst Chris Beauchamp said the impact of Trump's statements is weakening.

"Until investors are treated to the sight of senior US officials physically getting on a plane to Pakistan to negotiate, investors will become more skeptical," he said.

Briefing.com analyst Patrick O'Hare compared the situation to an intersection where the traffic light is flashing all colors at once.

Equity investors took their cue initially from the "green light" of Trump indicating that serious discussions are underway to end the war, he said.

But oil markets were swayed by the red light of Trump's threats to destroy Iran's oil fields and export terminal. There were also reports that the United States is readying ground troops, he noted.

- New risks -

European stocks closed higher, with Frankfurt rising despite data showing German inflation in March jumped to its highest level since January 2024, on the back of rocketing energy prices due to the Middle East war.

Asia's leading stock markets ended the day lower. The Japanese yen jumped on talk that the Bank of Japan could intervene on markets to shore up the country's currency.

The yen's gains weighed heavily on Japanese exporters, with the Tokyo stock market closing down almost three percent.

India's rupee fell to a record low of more than 95 to the dollar on Monday before recovering.

The country is one of the "most vulnerable economies within Asia to an energy price shock," Nomura analysts wrote in a note.

As the war entered its fifth week, the spectre of a widening conflict grew as Houthi rebels said Saturday they fired "a barrage of cruise missiles and drones" at strategic sites in Israel.

"The Houthi's ability to disrupt shipping through the Bab al-Mandeb strait, which accounts for roughly 12 percent of global trade, is the new key risk," said Pepperstone analyst Chris Weston, referring to the waterway between Yemen and the Horn of Africa.

- Key figures at around 2015 GMT -

Brent North Sea Crude: UP 0.2 percent at $112.78 a barrel

West Texas Intermediate: UP 3.3 percent at $102.88 a barrel

New York - Dow: UP 0.1 percent at 45,216.14 points (close)

New York - S&P 500: DOWN 0.4 percent at 6,343.72 (close)

New York - Nasdaq Composite: DOWN 0.7 percent at 20,794.64 (close)

London - FTSE 100: UP 1.6 percent at 10,127.96 (close)

Paris - CAC 40: UP 0.9 percent at 7,772.45 (close)

Frankfurt - DAX: UP 1.2 percent at 22,562.88 (close)

Tokyo - Nikkei 225: DOWN 2.8 percent at 51,885.85 (close)

Hong Kong - Hang Seng Index: DOWN 0.8 percent at 24,750.79 (close)

Shanghai - Composite: UP 0.2 percent at 3,923.29 (close)

Euro/dollar: DOWN at $1.1460 from $1.1517 on Friday

Pound/dollar: DOWN at $1.3183 from $1.3272

Dollar/yen: DOWN at 159.69 yen from 160.20 yen

Euro/pound: UP at 86.93 pence from 86.78 pence

burs-rl-bys/des

(U.Gruber--BBZ)