Oil Rallies on MidEast Tensions, Stocks Weighed by Trade Remarks
Oil prices rallied Monday after Iran warned the presence of US forces in the Gulf was causing instability in the region, while equities were mostly down as Donald Trump said he did not want a partial trade deal with China.
Hong Kong, Sep 23 (AFP) Oil prices rallied Monday after Iran warned the presence of US forces in the Gulf was causing instability in the region, while equities were mostly down as Donald Trump said he did not want a partial trade deal with China.
While a loosening of monetary policy by central banks is providing support to investors, they remain on edge following last week's attack on Saudi oil facilities that was claimed by Huthi rebels in Yemen but blamed by the US on Iran.
President Hassan Rouhani on Sunday hit out at a US move to increase troop numbers in Saudi Arabia, saying: "Foreign forces can cause problems and insecurity for our people and for our region."
He called on outside powers to "stay away" from the region and added that Tehran would present a peace plan to the United Nations within days.
Investors are concerned about a possible conflict in the oil-rich Middle East after last week's attacks -- which hammered Saudi Arabia's biggest crude plant -- though both sides have said they do not want a war.
The US has ramped up sanctions on Tehran, targeting its central bank.
Both main oil contracts saw prices rise more than one per cent Monday and traders are keeping tabs on Riyadh's progress in repairing the facilities.
"You can never say never, but with an Iranian delegation apparently due to attend the UN session opening week in New York, it is hard to imagine too many fireworks in the gulf this week," said OANDA senior markets analyst Jeffrey Halley.
Equity markets were mostly lower with investors tracking comments from Trump saying he wanted to strike a full trade deal with Beijing, knocking hopes for a piecemeal agreement between the economic superpowers.
"I'm not looking for a partial deal. I'm looking for a complete deal," he told reporters at the White House.
He added that he did not see the need for an agreement before the 2020 presidential election.
The remarks tempered recent optimism on the talks, though came as China hailed progress in preparatory discussions ahead of a planned high-level meeting next month.
"The hot and then cold and then hot and cold again US-China trade vibes continue to rattle markets," said Rodrigo Catril at National Australia Bank.
"Hopes of a potential interim trade deal had boosted sentiment ahead of last week's China's trade delegation visit to the US, but in the end it seems that the inability to find common ground in key contentious issues such as intellectual property rights resulted yet again in an increase in tensions."
In early trade Hong Kong fell 0.4 per cent with China's Fosun International losing 1.3 per cent after British travel giant Thomas Cook -- in which it is the top shareholder -- collapsed.
The 178-year-old firm had went under after failing to secure ?200 million (USD 250 million) from private investors to keep it afloat.
Shanghai shed more than one per cent, while Singapore and Seoul each dropped 0.2 per cent.
Taipei and Manila also fell, though there were small gains in Sydney, Wellington and Jakarta. Tokyo was closed for a holiday.(AFP)
(This is an unedited and auto-generated story from Syndicated News feed, LatestLY Staff may not have modified or edited the content body)