Investors pause stock selloff amid Saudi oil threats
Investors hit the pause button onthat began last week amid mounting concerns about relations with Saudi Arabia following the disappearance and suspected murder of journalist Jamal Khashoggi.
The Dow Jones Industrial Average was little changed at 25,337 in early trading on Monday. The Dow and S&P 500of their value last week as investors shifted money amid concerns about global trade tensions and economic growth.
Tensions between the U.S. and Saudi Arabia are rising following the disappearance of Khashoggi, who was last seen entering the Saudi consulate in Istanbul. Several prominent executives, including described as a “veiled threat” to use its oil wealth as a political weapon.n, canceled plans to attend a conference in Saudi Arabia later this month. At the same time, Saudi Arabia made what Bloomberg News
“The U.S. is less dependent on Saudi oil than it used to be, given its domestic shale production and it also exports large amounts of crude oil itself,” wrote analyst Fiona Cincotta of City Index in a research note. “Nevertheless, tempers are running high, Saudi stocks have dropped 7% over the weekend and now the country is considering economic retaliation.
U.S. benchmark crude gained 19 cents to $71.53. It added 0.5 percent to $71.34 a barrel in New York on Friday. Brent crude, the international standard, added 40 cents to $80.83.
On top of the tensions with Saudi Arabia, investors are growing worried that U.S.-China trade tensions are impairing global economic growth. The International Monetary Fund cut its forecast for global economic growth last week because of trade tensions and rising interest rates.
“The repercussions of trade tensions that had plagued global equity markets persist,” said Jingyi Pan, market strategist at IG in Singapore.
News that Chinese President Xi Jinping and President Donald Trump may meet has sparked hope that tensions in the trade war between the world’s two largest economies might ease. But worries about the increased tariffs the two sides have imposed on each other’s goods, a move that tends to dampen growth, are contributing to volatility in financial markets.
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