Oil shrugs off Trump’s latest Iran extension; UK consumers feel ‘ripple of fear’ from the conflict – business live
Introduction: Markets ‘growing numb’ to Trump’s TACO’s
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Is the market losing its appetite for TACOs?
Oil traders are shrugging off Donald Trump’s latest pause on striking Iran’s energy infrastructure, and are keeping crude prices at elevated levels today.
Last night, Trump extended his deadline for Iran to open the strait of Hormuz by 10 days to 6 April, claiming talks are “going very well”. But with Iran denying it is “begging to make a deal”, as the US president claims, the delay isn’t bringing much cheer to energy markets.
Brent crude oil did drop after Trump made his comments, but it has now risen back to $108.37 a barrel, slightly higher today, having jumped by 5% on Thursday before the extension was announced.
With Trump claiming ceasefire talks “are going very well”, traders can also see Iranian officials describing the US proposal as one-sided and unfair.
Asia-Pacific markets seem unimpressed too – Japan’s Nikkei is down 0.43%, with South Korea’s KOSPI losing almost 0.5%.
Tony Sycamore, market analyst at IG, says Trump has extended the uncertainty gripping markets:
While the rhetoric around de-escalation and dialogue is certainly preferable to outright conflict, the market appears to be growing increasingly numb to President Trump’s verbal reassurances. By extending the deadline, it effectively kicks the can down the road, pushing back any concrete resolution regarding the reopening of the Strait of Hormuz. This, in turn, simply extends the uncertainty weighing on markets and the broader global economy.
The agenda
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7am GMT: UK retail sales for February
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9am GMT: ECB Consumer Inflation Expectations survey
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2pm GMT: University of Michigan consumer confidence report
Key events
Trump’s new 10-day extension for Iran came shortly after Wall Street posted its biggest daily loss since the Iran war began.
Michael Brown, senior research strategist at Pepperstone, suspects the US stock market fell close to the White House’s ‘pain threshold’:
Call me a cynic, but the latest ‘TACO’ coming just eleven minutes after the S&P had closed out its worst day since the conflict began, having notched a loss of 1.7% on the day, is surely not a coincidence.
Yet again, this shows us that not only is Trump still receptive to pressure from financial markets, but that we are also still very, very close to the Admin’s pain threshold. Put even more simply, 6,500 in spoos is the strike price for the ‘Trump Put’.
UK consumers feel ‘ripple of fear’ from Iran war
Phillip Inman
A long-running measure of consumer confidence has confirmed that UK households are losing faith in the ability of the economy and their own finances to grow since the Middle East conflict began.
Amid forecasts of a jump in inflation as Brent crude prices remained above $100 a barrel, GfK said its confidence index was down two points to -21 in March – the weakest level since Donald Trump announced sweeping import tariffs in April last year. At the time, the index sank to -23.
Neil Bellamy, the firm’s consumer insights director, said the survey showed people are concerned about the prospects for inflation and the economy.
“A ripple of fear is spreading as is evident from the six-point fall in perceptions of the general economic situation over the next 12 months.”
GfK said the sharp rise in energy prices caused by the effective closure of the strait of Hormuz and attacks on infrastructure in the region “has led to fears of higher inflation and weaker growth across oil-importing countries”.
A majority of respondents said the economy had improved modestly over the last year, but was about to decline significantly. They said they were likely to save more and spend less on big ticket items over the next 12 months as a result.
A measure of consumer sentiment by the British Retail Consortium showed yesterday that consumer confidence had “collapsed” since the start of the Iran war.
The BRC poll asked about the state of the UK economy over the next three months, 64% of respondents told a survey they expected it to get worse. Just 11% thought it would get better. The resulting balance of -53% was sharply lower than the -20% reading a month earlier.
Introduction: Markets ‘growing numb’ to Trump’s TACO’s
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Is the market losing its appetite for TACOs?
Oil traders are shrugging off Donald Trump’s latest pause on striking Iran’s energy infrastructure, and are keeping crude prices at elevated levels today.
Last night, Trump extended his deadline for Iran to open the strait of Hormuz by 10 days to 6 April, claiming talks are “going very well”. But with Iran denying it is “begging to make a deal”, as the US president claims, the delay isn’t bringing much cheer to energy markets.
Brent crude oil did drop after Trump made his comments, but it has now risen back to $108.37 a barrel, slightly higher today, having jumped by 5% on Thursday before the extension was announced.
With Trump claiming ceasefire talks “are going very well”, traders can also see Iranian officials describing the US proposal as one-sided and unfair.
Asia-Pacific markets seem unimpressed too – Japan’s Nikkei is down 0.43%, with South Korea’s KOSPI losing almost 0.5%.
Tony Sycamore, market analyst at IG, says Trump has extended the uncertainty gripping markets:
While the rhetoric around de-escalation and dialogue is certainly preferable to outright conflict, the market appears to be growing increasingly numb to President Trump’s verbal reassurances. By extending the deadline, it effectively kicks the can down the road, pushing back any concrete resolution regarding the reopening of the Strait of Hormuz. This, in turn, simply extends the uncertainty weighing on markets and the broader global economy.
The agenda
-
7am GMT: UK retail sales for February
-
9am GMT: ECB Consumer Inflation Expectations survey
-
2pm GMT: University of Michigan consumer confidence report
