{"id":315936,"date":"2026-03-06T11:50:14","date_gmt":"2026-03-06T11:50:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/315936\/"},"modified":"2026-03-06T11:50:14","modified_gmt":"2026-03-06T11:50:14","slug":"middle-east-war-shakes-sharemarkets-as-bond-yields-and-oil-prices-jump","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/315936\/","title":{"rendered":"Middle East war shakes sharemarkets as bond yields and oil prices jump"},"content":{"rendered":"New Zealand 10-year bond yields are at 4.51% from 4.35% at the start of the week, while the local sharemarket has lost just under 2% since the conflict began.<\/p>\n
Oil prices have remained under upward pressure, with West Texas Intermediate trading above US$80 a barrel for the first time in over a year, and Brent crude trading above US$85 a barrel.<\/p>\n
Saudi Arabia is diverting oil to its Red Sea ports via a pipeline, but other producers in the area are reliant on access through the Strait of Hormuz.<\/p>\n
Harbour Asset Management portfolio manager Shane Solly said the markets\u2019 reaction so far had been a mixture of \u201crisk off\u201d and the unwinding of \u201ccrowded\u201d trades \u2013 people taking profits.<\/p>\n
\u201cThere\u2019s plenty of crude out there globally, it\u2019s just that there are now logistics issues with the Strait of Hormuz virtually closed.\u201d<\/p>\n
Qatar has stopped making liquefied natural gas after neighbouring Iran attacked its facilities.<\/p>\n
\u201cAnd there are specific issues with LNG, which places like Japan and North Korea depend on,\u201d he said.<\/p>\n
\u201cThe US market has been anticipating potential for risk, but we have seen some big pullbacks in the Japan and Korean sharemarkets,\u201d Solly said.<\/p>\n
\u201cBoth economies are big energy importers, but both markets [Japan and South Korea] had been big outperformers going into this,\u201d he said.<\/p>\n
\u201cThe debate in the capital markets is about whether this will be a short, swift campaign to bring Iran to the negotiating table and land a nuclear deal, or a regime change,\u201d he said.<\/p>\n
Central bankers around the world will have their work cut out in terms of how to handle the likely inflationary impact of the conflict.<\/p>\n
Before the attack, markets had expected the US Federal Reserve to cut rates once or twice this year.<\/p>\n
\u201cNow with this higher inflation, it\u2019ll be sitting on the sidelines,\u201d Imre Speizer, head of strategy at Westpac New Zealand, said.<\/p>\n
Market moves so far had been relatively orderly.<\/p>\n
\u201cSo far, I\u2019d call it relatively orderly \u2013 relative to the war. It\u2019s not complete panic stations yet, but it\u2019s early days.<\/p>\n
\u201cA lot of pundits, commentators and economists offshore are talking about oil north of hundreds of dollars per barrel, so there is potential for prices to go a lot higher still if this thing intensifies,\u201d Speizer said.<\/p>\n
The Financial Times reported the war had caused aluminium smelter closures and \u201cforce majeure\u201d declarations across the industry in the Middle East, threatening a supply crunch in the metal with global stocks already close to historic lows.<\/p>\n
On the London Metal Exchange, aluminium traded at US$3322 a tonne \u2013 its highest level since 2022.<\/p>\n
Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector and energy. He joined the Herald in 2011.<\/p>\n
Stay ahead with the latest market moves, corporate updates, and economic insights by subscribing to our Business newsletter<\/a> \u2013 your essential weekly round-up of all the business news you need.<\/p>\n","protected":false},"excerpt":{"rendered":"New Zealand 10-year bond yields are at 4.51% from 4.35% at the start of the week, while the…\n","protected":false},"author":2,"featured_media":315937,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[95,161230,806,89,17517,6867,138,3806,219,71,305,4493,1943,12469,16609,5873,23902,10110,111,139,69,4156,12937,7676,5034,7192,71299,71780,2441,19554,6149,6123,377,102241],"class_list":["post-315936","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-and","tag-arising","tag-as","tag-attack","tag-because","tag-bond","tag-business","tag-east","tag-economy","tag-from","tag-have","tag-increased","tag-inflation","tag-interest","tag-iran","tag-israel","tag-jump","tag-middle","tag-new-zealand","tag-newzealand","tag-nz","tag-oil","tag-prices","tag-rates","tag-response","tag-risk","tag-shakes","tag-sharemarkets","tag-spike","tag-taken","tag-war","tag-while","tag-world","tag-yields"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/315936","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=315936"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/315936\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/315937"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=315936"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=315936"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=315936"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}