Oil prices surge after US strike kills Iran general

IRAN. This photo released by the Iraqi Prime Minister Press Office shows a burning vehicle at the Baghdad International Airport following an airstrike in Baghdad, Iraq, early Friday, January 3, 2020. The Pentagon said Thursday that the U.S. military has killed Gen. Qassem Soleimani, the head of Iran's elite Quds Force, at the direction of President Donald Trump. (Iraqi Prime Minister Press Office via AP)

BEIJING — Oil prices surged and Asian stocks were mixed Friday, January 3, after an Iranian general was killed by U.S. forces in Iraq.

Benchmarks in Shanghai and Hong Kong declined. Australia and some Southeast Asian markets advanced. Japanese markets were closed.

News that Gen. Qassem Soleimani, head of Iran’s elite Quds Force, was killed in an air attack at the Baghdad international airport prompted expectations of Iranian retaliation against U.S. and Israeli targets.

“A big fat dollop of geopolitical uncertainty has landed on investors desks,” said Jeffrey Halley of Oanda in a report.

Overnight, Wall Street rose to new records, boosted by technology stocks.

Investors were encouraged by expectations of stronger global economic growth in 2020 and the planned signing of an interim U.S.-Chinese trade agreement.

The Shanghai Composite Index shed 0.3% to 3,076.73 and Hong Kong's Hang Seng lost 0.2% to 28,482.88. Taiwan and Singapore also declined.

Seoul's Kospi was off less than 0.1% at 2,173.20 and Sydney's S&P-ASX 200 gained 0.7% to 6,739.80. India's Sensex opened down 0.3% at 41,505.83.

Markets in Malaysia and Indonesia, both oil producers, gained.

There was no immediate indication how Iran would respond to Soleimani's death, but Tehran has seized oil tankers and shot down a U.S. military drone.

Washington blames Iran for attacks on tankers and a September assault on Saudi Arabia’s oil industry that temporarily cut its production by half.

Brent crude, used to price international oils, was up $2.14 at $68.39 per barrel in London after temporarily jumping nearly $3. The contract gained 25 cents on Thursday to close at $66.25.

Benchmark U.S. crude was up $1.87 at $63.05 per barrel in electronic trading on the New York Mercantile Exchange. It lost 12 cents the previous day to close at $61.18.

On Wall Street, the benchmark S&P 500 index climbed 0.8% to 3,257.85. The Dow Jones Industrial Average rose 1.2% to 28,868.80. The Nasdaq composite gained 1.3% to 9,092.19.

Walt Disney, Boeing, Apple and other big companies rose. Technology sector stocks accounted for a good part of the upward move. Smaller-company stocks lagged the broader market’s gains.

The S&P 500 and Nasdaq closed out the year Tuesday with their best annual performance since 2013.

Investors are waiting for Washington and Beijing to formalize a trade deal that has helped ease market jitters over the 18-month-old dispute between the world’s two biggest economies.

Washington and Beijing announced a "Phase 1" pact that calls for the U.S. to reduce tariffs and China to buy larger quantities of U.S. farm products.

This week, President Donald Trump tweeted that he will sign the initial trade deal with China at the White House this month.

In currency markets, the dollar declined to 108.09 yen from Thursday's 108.56 yen. The euro edged down to $1.1168 from $1.1171. (AP)


SunStar website welcomes friendly debate, but comments posted on this site do not necessarily reflect the views of the SunStar management and its affiliates. SunStar reserves the right to delete, reproduce or modify comments posted here without notice. Posts that are inappropriate will automatically be deleted.

Forum rules:

Do not use obscenity. Some words have been banned. Stick to the topic. Do not veer away from the discussion. Be coherent. Do not shout or use CAPITAL LETTERS!