Markets have responded positively to the news of the killing of arch-terrorist Osama Bin Laden in Pakistan. The price of oil has fallen more sharply than at any time in the past two weeks, and prices of futures contracts on leading stock indices on Wall Street are rising, indicating that there will be a positive start to the trading week later on today.
The futures contracts are up by as much as 0.8%, while oil is down 1.5%, to $112 per barrel. The MSCI Asia index is up 0.7%.
“This is a positive development in the campaign against terrorism,” Jonathan Ravelas, chief market strategist at Manila-based Banco de Oro Unibank Inc. in Manila, told Bloomberg, adding, “In the last 10 years, bin Laden’s presence has been a serious threat to global stability. The flipside is this could be followed by retaliation activities from his supporters."
The S&P 500 index, the leading stock index in the US, completed four successive days of rises on Friday, following good financials released by major companies such as Caterpillar and Merck. On the US bond market, prices fell last week, and the yield on ten-year treasuries rose to 3.31%.
The dollar is strengthening slightly, and the Dollar Index , which tracks the US currency against six other major currencies, is up 0.3%. “This is good news for the US, and that means the dollar gets bought. This may reduce the burden of U.S. military expenses and prove that Obama’s operation was right,” Kuniyuki Hirai, manager of foreign-exchange trading at Bank of Tokyo-Mitsubishi UFJ Ltd., a unit of Japan’s largest lender, told Bloomberg.
Published by Globes [online], Israel business news - www.globes-online.com - on May 2, 2011
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