Global stock markets were mixed on Monday as the price of Brent crude rose $2.50 a barrel earlier in the day as talks to end the US-Iran war remained stalled.
Disruptions to shipping through the Strait of Hormuz have driven up oil prices since the start of the war.
On Monday, Brent futures rose just over 1% to $106.47 a barrel, after initially trading around a multi-week high of $108.50 earlier in the session.
“It may be that hopes for a diplomatic breakthrough were initially quite weak and markets are now in a wait-and-see mode ahead of a week of gains and economic touchpoints,” said Derren Nathan, head of equity research at Hargreaves Lansdown.
Given high energy prices, the U.S. Federal Reserve is expected to leave interest rates unchanged on Wednesday, followed by similar decisions from the European Central Bank and the Bank of England, which analysts say will help share prices continue to rise.
Markets in London, Paris and Frankfurt all made progress despite high oil prices and a lack of progress in negotiations. US futures were largely stable ahead of trading.
Asian markets were mixed on Monday as Tokyo and Seoul benefited from a tech rally while Hong Kong slipped.
Investors also awaited earnings this week from US tech giants Alphabet, Meta, Microsoft, Amazon and Apple.
“In recent weeks, investors have been encouraged by corporate news that has led to higher share prices,” said Russ Mold, investment director at AJ Bell.
However, he added that “prolonged oil prices mean problems for inflation, which in turn could be a headwind for the economy.”
CBS/AFP
