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Stocks Decline on Mideast Tensions

Global markets were rocked by fresh conflict in the Middle East that sent stocks lower while oil and haven assets including Treasures and the dollar rallied.

Gains for Treasuries sent the 10-year yield as much as 14 basis points lower. An index of the dollar rose as much as 0.6%, while other havens including the Swiss franc, yen and gold also advanced. The moves came as Israel launched a missile strike on Iran less than a week after Tehran’s rocket and drone barrage, according to two US officials, raising fears of a widening conflict across the Middle East.

However, markets pared some of the risk-off moves after Iran said its Isfahan nuclear site was safe. Oil prices jumped more than 4%, with Brent crude rallying above $90 per barrel before retreating back below that level. A gauge of Asia ex-Japan credit default swaps also headed for its biggest daily increase in more than eight months. Futures contracts for the S&P 500 and Nasdaq 100 fell nearly 1% after the underlying benchmarks dropped for a fifth session on Thursday, amid repricing of Federal Reserve interest rate cut expectations. Asian equities also dropped Friday, with Japanese, South Korean, Australian and Hong Kong stocks sliding.


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