Stocks of energy and defense companies rose sharply Monday, after Israeli Prime Minister Benjamin Netanyahu declared over the weekend that the country was “in a war” against the militant group.
Major U.S. stock indices opened lower on the news on Monday morning, with the S&P 500 losing half a percentage point in early trading, falling to 4,285. The index closed up 0.6 percent at 4,334.
The technology-heavy Nasdaq Index was down more than 100 points to 13,321, before also closing up 52 points, and the Dow Jones Industrial Average dropped 85 points in early trading before rebounding to finish 197 points up.
Experts said oil prices are also rising over fears of violence spilling out beyond Gaza.
“The crude oil market remains hyper-alert to any indication that the conflict between Israel and Hamas is poised to expand into the oil producing region in the Middle East,” Quincy Krosby, strategist for North Carolina-based LPL Financial, said in a statement.
“Reports regarding Iran’s support for the Hamas attack have been denied by Iran but concern is focused on a broader Iran-Israeli conflict, which would, in turn lead to a dramatic escalation of conflict in the region, and a dramatic climb in oil prices,” Krosby said.
The dollar also grew stronger amid the uncertainty, gaining on the euro and the sterling on Monday before subsiding.
The dollar has been supercharged recently by high-flying U.S. Treasury yields, themselves bolstered by fiscal precarity in Congress following a narrowly avoided government shutdown and the ouster of Rep. Kevin McCarthy (R-Calif.) as Speaker.
The Hill’s Tobias Burns has more here.
