By Amanda Cooper and Tom Westbrook LONDON/SINGAPORE, May 12 Oil gained for a third day on Tuesday and the dollar rose as hopes faded for a deal to get ships moving through the Strait of Hormuz, while a red-hot rally in chip stocks cooled and traders waited on U.S. inflation…
President Donald Trump said the month-old ceasefire with Iran was “on life support” after Tehran’s response to a U.S. plan to end the war made clear the sides were far apart. Brent crude futures were up almost 4% to about $108 a barrel. In Europe, the STOXX 600, which is still only 4% below late February’s record high, was down 0.6%, while U.S. stock futures for the S&P 500 and Nasdaq were down 0.4% and 0.9%, respectively.
TRUMP’S TRIP TO CHINA IN FOCUS The shine even came off the almost unstoppable KOSPI index in Seoul, which recoiled as it approached 8,000 points and dropped about 3.5%, pulling down other regional markets. [.KS] Deutsche Bank strategist Jim Reid said with U.S. and Iran appearing no closer to resolving their negotiation deadlock, Brent crude prices were extending the previous day’s rally. “Markets are also pricing rising chances of lasting disruption, with 6-month Brent futures up 2.54% to $89.50 a barrel yesterday,” he said. Markets are keeping a watchful eye on Trump’s visit to China, which begins on Wednesday, with expectations low for either progress on Iran or on the trade front. “Investors should not expect sweeping agreements. A ‘win’ would mean no new tariffs or export controls, and perhaps small symbolic deals, such as agricultural purchases, aircraft orders, or signals on rare earths,” said Daniel Casali, chief investment strategist at Evelyn Partners. “These may seem minor, but stability at the margin matters.” APRIL INFLATION SPIKE EXPECTED IN U.S.