ASX set for uncertain start as Hormuz closed again; Oil set to jump
Staff writers
The Australian stock market will have an uncertain start to the week due to rising tensions in the Middle East.
Shares rose on Wall Street in New York on Friday and oil prices fell after Iran said the Strait of Hormuz was open again for commercial tankers carrying crude from the Persian Gulf to customers around the world, but the critical waterway was closed again on Sunday (AEST).
The Islamic Revolutionary Guard Corps (IRGC) announced that it will prevent ships from passing through the Strait of Hormuz while the US embargo on Iranian ports continues; Iran says this move violates the terms of the ceasefire agreement. US President Donald Trump later threatened to launch overnight attacks on power plants and bridges in Iran if a deal was not reached this week.
This sets the stage for a choppy start to trading on the ASX on Monday morning.
Before the latest developments, Wall Street’s S&P 500 index rose 1.2 percent to an all-time high and closed with big gains for a third straight week, its longest streak since Halloween. The Dow Jones Industrial Average rose as high as 1,100 points before paring its gain to 868, or 1.8 percent. The Nasdaq composite rose 1.5 percent.
Oil prices fell sharply on Saturday ahead of the latest developments, with international benchmark Brent falling 9.1 percent and US oil losing 11.5 percent. Oil will continue to be traded this morning.
Several times since the war began, optimism on Wall Street has turned to doubt about a possible end to the war. This caused wild and sudden fluctuations in the prices of everything from stocks to bonds to oil.
A strong start to the earnings reporting season for major US companies also helped support the US stock market, with more financial companies joining the list and posting more profits at the start of 2026 than analysts expected.
State Street rose 2.5 percent and Fifth Third Bancorp rose 1.7 percent after both reported better-than-expected results in the latest quarter.
They helped offset the 9.7 percent drop even as Netflix posted a better-than-expected profit. It was noteworthy that the company did not increase its revenue growth forecast for the whole year, which analysts said may have disappointed some investors.
It was also stated that the publishing company’s co-founder and chairman, Reed Hastings, will leave the board of directors in June when his term expires.
AP via Bloomberg
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