Iran finance minister Ehsan Khandouzi
The market went into the weekend fearful that a broader conflict could break out over the weekend if/when Israel launched a broader counter-offensive. That action hasn’t taken place, though airstrikes continue in Gaza.
Normally, there would be something of a sign of relief from markets into the new week and we see some of that but talk like this from Iran’s finance minister is keeping markets on edge:
- Iran will not remain an observer in this situation and has informed Israel via its allies if its crimes in Gaza continue ‘tomorrow will be too late’
- If the scope of Gaza war widens, heavy losses will be inflicted on the US.
A separate report cites guarantees from the US that if Hezbollah attacks from Lebanon in any larger scale, the US will engage them from one of the aircraft carriers stationed off the coast.
Meanwhile, here’s a spokesman from Israel’s military:
- Hezbollah is escalating the situation on Lebanon’s border to hinder Gaza offensive
- Israel is prepared to fight on two fronts, and even more, if required
- More than 600,000 Gazans have relocated southward, evacuations continue
- Air strikes designed to hit ‘maximum terrorists, minimum civilians’
- 155 captives are held by Hamas in Gaza
You hope that it’s all just tough talk but there’s real potential for this to spill into a broader war. I imagine there’s some bravado in these comments from Iran because they’re badly outgunned.
As for markets, it’s a good time to be holding cash and watching the headlines roll in.