Stocks fall as yen firms; Gulf attacks send oil towards $100 a barrel

By Amanda Cooper LONDON, Sept 8 (Reuters) - The yen traded around seven-month highs on Tuesday and stocks fell after a volley of attacks on energy facilities around the Gulf drove oil to near $100 a barrel. Brent crude futures hit their highest in six weeks, nearing $100 a barrel, after Yemen's Iranian-backed Houthis attacked energy facilities and cities in Saudi Arabia. This highlights the risk of the conflict spreading throughout the region and further complicating fuel supply to world markets.

The price of diesel and gasoline has hit record highs, nearly doubling from pre-conflict levels, and physical crude prices are well above futures prices, indicating the conflict’s toll on the global energy market. A resurgence in inflation has weakened equity markets due to rising bond yields, pressuring central banks to raise interest rates. The European Central Bank is expected to raise euro zone rates by a quarter point on Thursday, while the Bank of Japan may follow suit next week, strengthening the yen’s rally to its highest in two years.

Equity markets in Europe slipped, with the STOXX 600 down 0.2%, while S&P 500 and Nasdaq futures were down 0.4% and 0.1%, respectively. The yen’s surge—up nearly 4% in a week—undermines carry trades, where low-yielding yen was borrowed to invest in higher-yielding assets. Japanese real wages rose 2.4% in July, reinforcing the case for the Bank of Japan to tighten monetary policy.

Meanwhile, copper prices hit record highs due to global supply tightening ahead of potential tariffs, with three-month copper up 1.1% at $14,673 a ton. U.S. 10-year Treasury yields reached 4.8%, nearing their highest since November 2023.

Source: Euronext Markets: Real-time Stock Market Data | live