2023-10-09 21:22:06
The war in the Middle East is a drama. Another one in this world full of crises. The fate of the stock exchanges is to assess emerging conflicts within a very short time and to express this in prices for stocks, foreign currencies, bonds and raw materials. You have to abstract from the terrible fates of the people directly affected.
That’s always cynical. Because ultimately it comes down to the question: Does the war affect the wallets of consumers in the important economies of North America, Europe and China? On Monday the answer to that is: hardly. In China the stock markets remained stable, in Frankfurt the DAX was a few tenths of a percent in the red. No sign of panic. The flight to safety often described in conflicts is therefore not a flight so far, just a slight tendency for the dollar, gold and bonds from Germany and the USA that are considered safe. The economic area in and around Israel is simply too insignificant for the world.
However, that does not mean that the conflict could not have even greater effects on the stock markets. This can happen quickly. When it came to Russia’s attack on Ukraine, the argument was initially based on the low extent of trade ties with the region. However, it soon became clear that the Western wallet would not come out of the war unscathed. Not only do arms deliveries to Ukraine cost a lot of tax money. The distortions on the raw materials markets have a much greater impact.
The oil price was three percent higher on Monday. That’s less than it fell last week. Israel and the Palestinian territories are irrelevant to the oil market. But the neighboring Arab world is even more important for Western oil supplies, especially since the sanctions against Russia already exclude a major oil exporter. A further shortage of supply could have a significant impact on prices. Iran is named as the first candidate for failed or boycotted deliveries. Even more important is Saudi Arabia, with which the West is trying to get on good terms.
Christian Siedenbiedel Published/Updated: , Recommendations: 20 A comment from Daniel Mohr Published/Updated: , Recommendations: 17 Werner Sonne Published/Updated: Recommendations: 31
There is therefore no reason for panic on the capital markets, but there is a reason for increased vigilance. Political conflicts can lead to stock market pressures for a few weeks. Usually not longer. Keyword wallet. As long as important sales markets for the industry do not fail permanently or their production facilities are destroyed on a large scale, such conflicts are certainly not good for the capital markets, but ultimately they are nothing more than a blip in a curve. That doesn’t change the drama on site and the terrible local impact – while in this country people are watching the consumer mood with concern. This cynicism is part of normal operations on the stock markets.
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