Oil Prices Rise Amid Global Market Focus on Middle East

Global Equities Index Advances Modestly Amid Ongoing Iran Tensions and Central Bank Decisions

The MSCI's global equities index rose modestly on Monday, driven by the White House's announcement that President Donald Trump was reviewing a proposal from Iran. Investors cautiously approached a busy week of megacap earnings reports, economic data, and central bank decisions.

The United States' review of Iran's proposal, which involves setting aside discussion of Iran's nuclear program until the war is ended and disputes over shipping from the Gulf are resolved, provided a slight boost to the market. Despite this, oil futures settled higher on concerns about tight energy supplies, as the ongoing war has limited energy shipping through the Strait of Hormuz.

US Crude and Brent Prices Rise

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US crude settled up 2.09%, or $1.97 at $96.37 a barrel, while Brent settled at $108.23 per barrel, up 2.75%, or $2.90, on the day.

On Wall Street, the Dow Jones Industrial Average fell 62.92 points, or 0.13%, to 49,167.79, while the S&P 500 rose 8.83 points, or 0.12%, to 7,173.91 and the Nasdaq Composite rose 50.50 points, or 0.20%, to 24,887.10. The MSCI's gauge of stocks across the globe rose 2.32 points, or 0.22%, to 1,074.52.

Economic Data and Earnings Reports on the Horizon

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Investors are waiting with bated breath for economic data and earnings reports, including first-quarter U.S. economic growth and the March Personal Consumption Expenditures Price Index, which is the Federal Reserve's preferred gauge for inflation. Firms such as Microsoft, Alphabet, Amazon, and Meta Platforms will report quarterly results on Wednesday, while Apple is scheduled to release results a day later.

Central Bank Meetings and Currency Market

The US dollar slipped on Monday as investors were on edge about the Middle East and a slate of central bank meetings later this week. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.16% to 98.49, with the euro up 0.01% at $1.1721. Against the Japanese yen, the dollar strengthened 0.01% to 159.39.

Central Bank Policy Decisions

Major central banks are expected to keep policy on hold this week, including the US Federal Reserve. The Fed's meeting, which runs Tuesday through Wednesday, will likely be the last with Jerome Powell as chair. The Bank of Japan, European Central Bank, and Bank of England are also expected to keep policy unchanged.

US Treasury Yields and Precious Metals

In US Treasuries, the yield on benchmark US 10-year notes rose 2.5 basis points to 4.336%, from 4.31% late on Friday. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 2.3 basis points to 3.799%. In precious metals, spot gold fell 0.62% to $4,679.09 an ounce.