Stock and bond futures advanced as oil retreated, with traders looking past the latest attacks on Saudi Arabia that threatened to widen the war in the Middle East.
Futures for the S&P 500 Index rose 0.3%, while those for Europe gained 0.6%. Asian equities lagged, with MSCI’s regional stocks gauge dropping 0.2% as South Korean shares slid 3% when trading resumed after a long weekend.
Brent crude dropped 1.2% to $103.43 a barrel after climbing to as high as $105.63 in early trade following weekend strikes by Yemen’s Houthis on Riyadh’s main airport.
Traders weighed resilient Middle East flows against rising regional tensions and a US claim that Russia and Ukraine had agreed to a so-called energy ceasefire. Treasury futures edged higher alongside government bonds in Australia and New Zealand. There’s no trading of cash Treasuries globally on Monday due to a US holiday.
Elsewhere, India’s rupee strengthened 1% after the central bank on Saturday unveiled some of its strongest measures to support the currency since the 2013 taper tantrum. Geopolitical risks have returned to the fore after the Houthi attacks raised the prospect of a broader conflict and further disruption to energy supplies.
