Blame it on Iran
The U.S. blamed Iran for attacks on two oil tankers near the Persian Gulf, further raising the risk of a military conflict. American officials have determined Tehran was responsible, Secretary of State Michael Pompeo said, without providing evidence. Iranian Foreign Minister Javad Zarif suggested his country’s enemies may be culpable and reiterated calls for regional dialogue. Here’s more on what the friction is about.
Oil Jumps on Supply Fears
Oil spiked on the attacks, with WTI surging as much as 4.5% from a five-month low before paring gains. OPEC also cut its first-quarter demand growth estimate to less than 1 million barrels a day as the trade war hurt economic growth. The cartel kept its 2019 estimate mostly unchanged, saying consumption will accelerate the rest of the year.
Hong Kong’s Possible Pause
Hong Kong may be edging toward delaying the proposed extradition law that triggered protests, but its financial elite are sweating. Chief Executive Carrie Lam’s political allies said they don’t see the bill as urgent and legislative debate is on hold until further notice. Opponents have called for another march for Sunday. Members of the U.S. Congress have reintroduced a measure defending Hong Kong’s autonomy, while China’s hard line approach may be giving its critics in Taiwan a boost too. It’s all helping create a new kind of pressure on President Xi Jinping.
Asian Futures Mixed
Hang Seng futures are looking slightly lower, while the Nikkei and Australian markets are poised for higher opens after U.S. stocks halted a two-day decline. The S&P 500 hit a five-week peak as a surprise uptick in jobless claims supported the idea the Federal Reserve could take a dovish turn. And Larry Kudlow kept the trade war embers burning with a warning to China that there will be “consequences” if Xi doesn’t agree to meet with President Donald Trump at the G-20 summit later this month.
No More Day Drinking
New rules will prohibit floor traders at the London Metal Exchange from drinking during the workday, according to people familiar with the matter. While the LME already bars dealers from engaging in drunken behavior on the floor, the policy would go further to break an association with heavy drinking that stretches back to the bourse’s origins in Victorian times. The Brexit Party’s Nigel Farage, who has often recounted details of his booze-fueled exploits in the city before he moved into politics, has helped to perpetuate the image of the hard-drinking metals trader.