Overview:
International stock markets declined Thursday amid escalating geopolitical tensions in the Middle East and elevated crude oil prices. The Euro weakened to its lowest level in 17 months, trading near USD 1.11. U.S. Treasury bond yields continued to rise, constraining equity valuations. Gold held near USD 4,150 per ounce as investors assessed inflation concerns and Federal Reserve policy direction.
Details:
American equities fell Thursday, with futures contracts recording significant declines as investors faced mounting pressure from higher Treasury yields and climbing oil prices. Brent crude penetrated the USD 104 barrier, driven by supply concerns stemming from escalating regional tensions and reduced U.S. production. Middle East shipping disruptions continued to support energy prices despite announcements from the International Energy Agency regarding drawdowns from strategic reserves.
The Euro extended losses to a fifth consecutive weekly decline, approaching levels last seen in May 2025. The widening yield spread between German and French 10-year bonds reflected market anxiety over eurozone fiscal conditions. However, technical indicators suggested selling momentum was beginning to moderate.
Shell resumed partial operations at its Pearl liquefied natural gas facility in Qatar following earlier disruptions. In global equities, strategic investments showed mixed signals: U.S. President Donald Trump disclosed securities transactions valued between USD 74.3 million and USD 273.3 million during August, with notable positions in major technology companies. Moody's maintained its long-term rating for the Emirates Strategic Investments Company at Baa3 with stable outlook.
Islamic banking assets in the UAE expanded by 6 percent—equivalent to USD 57.8 billion—reaching USD 1.022 trillion by end-August. Savings deposits grew 6.8 percent, adding USD 27.34 billion to the banking sector.
Outlook:
Investors are monitoring whether Middle East geopolitical risks will persist in constraining equity markets and supporting oil prices into year-end. Treasury yield dynamics and Federal Reserve interest rate guidance remain critical variables determining both bond and equity valuations through the final quarter.