Brent loses growth after soaring above $119, stocks fall: results of the 20th day of the war

Brent crude oil rose above $119 per barrel during trading on March 19 after new strikes on the energy infrastructure in the Middle East, but then lost all the gained and even became a little cheaper. Against this background, the volatility was also characterized by the shares in the USA: the main indices were falling most of the day, then they went into a small plus, but still ended the trades in the red zone. And only small-cap companies managed to grow.

- The S&P 500 broad market index was down 0.27% on Thursday.

- The blue-chip index Dow Jones Industrial Average fell by almost 204 points, or 0.44%.

- The Nasdaq Composite Technology Sector Index lost 0.28%.

- The Russell 2000 index of small and mid-capitalization companies was the only one to increase 0.65%.

- The CBOE Volatility Index (VIX), known as the Wall Street Fear Index, also declined, down 4.1% to 24 points. It is still above the psychological mark of 20 points, indicating high volatility.

- Brent crude oil futures were down less than 0.1% and cost about $107.3 per barrel. The cost of U.S. oil WTI was losing 1.4% and was about $95 per barrel.

- Spot gold prices fell by 3.3% to $4658 per troy ounce. Silver prices fell by 3.4% to $72.8.

- Bitcoin cheapened within 1 percent to about $70,400, CoinGecko shows.

The three major U.S. stock indices fell for the second day in a row. At the moment, the S&P 500, Dow and Nasdaq were losing 1%, 1.1% and 1.4%, respectively, while Brent rose by 11% and exceeded $119 per barrel.

The market was assessing the impact of Iran's strike on a major liquefied natural gas plant in Qatar and an oil refinery in Saudi Arabia. The attacks followed Israeli strikes on Iran's largest gas field, South Pars. US President Donald Trump threatened to "blow it up" if Iran continued to attack Qatar's gas facilities, but at the same time demanded that Israel stop attacking Iranian energy facilities.

Stocks and bonds in the U.S. then pushed off the lows for the day, while oil, by contrast, fell from its highs. This came after Israel said it was helping the U.S. in its bid to reopen shipping in the Strait of Hormuz, a crucial transportation artery that has been effectively blocked by Iran since the war began, Bloomberg writes.

Israel is refraining from new attacks on Iran's energy infrastructure at Trump's request, Israeli Prime Minister Benjamin Netanyahu said. The Israeli-U.S. war against Iran could end "much faster than everyone thinks," he said, without giving any timeline. Iran has no capability left to enrich uranium and produce ballistic missiles, Netanyahu said, although he did not provide evidence, Reuters reported.

U.S. Treasury Secretary Scott Bessent said Washington is considering easing sanctions on Iranian oil already at sea. The White House is seeking to reduce pressure from rising energy prices caused by the war in the Middle East. To that end, the U.S. has similarly eased restrictions on Russian oil.

Stocks closed trading in the minus due to investor pessimism about the likelihood of further interest rate cuts, which fell due to the inflationary effect of rising energy costs, writes Reuters. Fed Chairman Jerome Powell a day earlier, following the regulator's decision to keep the rate on hold, said the uncertainty of the war outlook and warned that without progress on inflation one should not expect monetary easing. Traders are now lowballing the chances of a rate cut sooner than mid-2027, CME's FedWatch tool shows.

About $5.7 trillion in options are due to expire on Friday, March 20, which carries the risk of even more volatility, Citigroup warned in a Bloomberg presentation.

- "All near-term action depends on the opening of the [Strait of Hormuz]. We believe it will open within weeks, not months," said Scott Wren, senior global equity strategist at Wells Fargo Investment Institute (quoted by Bloomberg).

- "While a less disruptive scenario in the Strait of Hormuz remains a possibility, recent events have narrowed that path and increased the risk of prolonged volatility," argues Ulrike Hoffmann-Burchardi, investment director for the Americas and global head of equities at UBS Global Wealth Management.

This article was AI-translated and verified by a human editor