Shane Solly: Harbour Asset Management spokesperson on the market response to the US strikes on Iran

Market reactions after the US strikes on Iran have been more 'muted' than expected, especially compared to the response from a week ago.

Reports indicate investors have brushed off this escalation. 

Shane Solly from Harbour Asset Management explains further.

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Episode Transcript

Speaker 1 (00:00):
Shane Soli Harbor Asset Managements. Will I say, Shane, Hello Heather. So,
how the capital markets reacted to the bombing, Well, pretty
muted reaction really to the to the weekends events, We've
actually seen global shear market indexed features. This is where
markets can be about what may happen in the future
when markets open up. In the Northern Hemisphere, actually they
dripped and then they've rebounded. So the uish shar market

(00:21):
market's telling us loaning me down point two percent, so
pretty cautious response. We actually saw a lot of the
Middle Eastern shear markets up over Sunday. US dollars pretty flat,
US bond's pretty flat. Oil spiked up five percent today
and then ended pretty much not up very much at all,
and they're locally. We've seen our dollar down a little
bit against the US or at fifty nine to twenty

(00:43):
ten year New Zealand government bond rape steady at four
point six percent, New Zealand share market down just zero
point three percent, and the other OSSI shar market down
zero point four percent, so pretty resilient. Really, what do
you think the market's going to do now? Yeah, it's
a tough one. We need to be pretty careful about
or in too many conclusions about what happened in the weekends.

(01:03):
We're going to see markets remaining chopping. And it depends
a bit on whether these attacks actually stimulate a widening war,
particularly this disruptive retaliations, or the conflict is actually quite
contained like Ukraine and to some degree like we saw
in the Iraq War in two thousand and three. The
key thing here that is the Straits of all means
getting closed by the Iranians. They've talked about a lot

(01:26):
since nineteen seventy nine when the Islamic Republic came into voice.
They've never done it. There's a bit of speculation out
there that if they closed the straits down or cut
even back to fifty percent capacity for a week or two,
we'd see Brent will potentially spike up above one hundred
dollars US a barrel, that compares with mid seventies at
the moment, and then there's an expectation that OPEC would

(01:47):
actually open up the taps. There's plenty of capacity there.
So look, I think you know, markets do tend to
recover from these events unless there's a clear escalation. We
should expect markets to think this is probably the worst
case and maybe we have this higher all price, not
too much higher, but a little bit higher, and a
bit of disruption, but really the market keeps going through. Yeah,

(02:08):
Shane listen, thanks for talking to us through. I appreciate
it as always. Talked to you next week, Shane Soley,
Harbor Asset Management. For more from Heather Duplessy Allen Drive
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