Oil prices extended gains Monday on signs that the war in Iran could last longer.
Hopes for a ceasefire have faded with the arrival of more US troops in the Middle East and the entry of Yemen’s Houthis into the war. Meanwhile, the Journal reported that President Trump is considering a military operation to extract uranium from Iran.
Taken together, these events have driven up oil prices. Benchmark U.S. crude oil advanced to around $102 a barrel. The most actively traded Brent crude futures contract rose to around $107, while contracts for May delivery hit $116 on Monday, reflecting tight supply, before retreating to $112.
U.S. stocks appeared to find a bottom after a sharp sell-off last week that put both the Dow industrials and the Nasdaq composite into correction territory.
The Dow Jones and S&P 500 posted modest gains on Monday, while the Nasdaq swung between small gains and losses.
“There’s a certain amount of bargain-hunting because you’ve seen such steep declines,” said Susannah Streeter, chief investment strategist at U.K.-based Wealth Club, an investment platform for high-net-worth individuals.
Meanwhile, bond yields fell around the world, as traders shifted their attention from the inflationary effects of the war to its impact on economic growth. The 10-year Treasury note fell below 4.35%, while traders slightly reduced expectations of an interest rate hike.
Write to Caitlin McCabe at caitlin.mccabe@wsj.com