Stocks and Metals Rebound as War Continues

The fog of war that overhung markets yesterday has lifted somewhat overnight after the US indicated it will provide insurance support to keep oil shipping moving through the Persian Gulf and that it has sunk much of Iran’s navy, reducing uncertainty at the margins for the moment.

Asia-Pacific markets had a rough night, with the Nikkei losing 3.6% and the Hang Seng dropping 2.0%, but equities appear to be regaining their footing this morning. US index futures are up 0.2% to 0.6%, led by the NASDAQ. On the flip side, yesterday’s rally in Crude Oil has faded, with US Crude down 0.8% and Brent Crude down 0.2%.

The US Dollar is also giving back some of Tuesday’s gains, enabling other currencies to rebound. Gold is up 1.4%, Silver is up 2.5%, Platinum is up 4.0%, and Bitcoin is up 4.3%. The Euro is up 0.3%, while the Loonie is steady. In commodity markets, Copper is up 1.5%, which may suggest that concerns about global economic disruption have eased somewhat for now.

US ADP private sector payrolls beat expectations in February (63K vs Street 50K), though that was partly offset by a downward revision to January. The market reaction has been muted as investors remain focused on geopolitical developments. US Services PMI is due at 10:00 am EST, followed by the Fed’s Beige Book regional economic report at 2:00 pm.

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