The Financial Post reports in its Saturday, Jan. 4, edition that on Friday investors fretted that an escalation in Middle East tensions could dent global growth. A Bloomberg dispatch to the Post reports that oil jumped on Friday along with assets seen as havens. The S&P 500 Index posted its biggest loss in a month after an American air strike killed Iranian general Qassem Soleimani. Iran has vowed "severe retaliation." Bloomberg says a search for safety drove gains in gold, the yen and Treasuries. As well, oil jumped the most in four weeks, but was off its peak for the day. Media reports say the United States intends to send "thousands of additional troops to the Middle East amid rising regional tensions." Former Barack Obama administration official Jason Bordoff says: "This is a seismic event in the region. This is how U.S. Iran tit-for-tat spirals out of control. Iran's response will be severe and deadly. And certainly may include escalating attacks on energy infrastructure." Manulife Asset Management's Nathan Thooft says: "Unless the escalation is severe and repeated, I see this as a temporary scare. Obviously the risk is it delays the global recovery as well as dents sentiment and thus earnings."
© 2020 Canjex Publishing Ltd. All rights reserved.