S&P 500 futures were down 1.22% this morning as part of a broad global selloff in the stock markets triggered by the conflict between Iran and the U.S. and Israel.
The STOXX Europe 600 was down 1.76% in early trading; the U.K.’s FTSE 100 was down 0.63% before lunch. Japan’s Nikkei 225 closed down 1.35%, and South Korea’s KOSPI was down 1%.
But even as investors entered a worldwide “risk-off” phase, some on Wall Street plotted for gains in assets that respond well to war:
- At Wells Fargo, Ohsung Kwon and his colleagues noted that, in the months after the first and second Gulf Wars, the S&P 500 rose 16% and 14%, respectively.
- Unsurprisingly, the price of oil rose sharply after the attack on Tehran began, rising 13% at one point.
- Gold, investors’ favorite safe haven, also went up this morning to a new all-time high.
- The dollar rose—it was up nearly 1% against the standard basket of foreign currencies before some of its gains were pared. Oil contracts are usually settled in dollars, so when oil goes up so does demand for U.S. currency.
- Defense stocks did well this morning. BAE Systems was up more than 6% on the U.K. market, and Germany’s Rheinmetall AG was up 2% prior to lunch.
