Events of the Middle East: market rection

Escalating tensions in the Middle East have frightened markets. Photo: AFP

Charlie Robertson, Chief Economist world, capital of the Renaissance:

"Events and the bloodshed in rich nations - such as Libya and Bahrain - suggest disorders can spread even more deeply in oil production, such as Iran, the Algeria or nations more worrying for the markets, Saudi Arabia."

Rising prices for oil and gold yesterday are responses of rational market this uncertainty and Russia - with exposed both - equities should do well. In Ghana, the Kazakhstan and Nigeria are likely beneficiaries too, although it is frontier markets.

"Safe haven currencies, such as the franc Switzerland (vs Euro) and the yen would normally well in this environment, but the two are already expensive." Norwegian kroner (versus the Euro) is probably the most obvious beneficiary of this uncertainty, held its exports of petroleum and distance from the Middle East.

On the other hand, the Turkey perhaps suffer, given its dependence on oil and regional proximity... and as the Turkish Lira is now relatively good market in the short, we need to see Central Bank intervention to reduce volatility.

Jim Reid, strategist, Deutsche Bank:

"Libya has the largest reserves of oil in Africa and the ninth largest worldwide political instability naturally is a source of concern regarding prices and production volumes.

Joshua Raymond, market strategist, city Index:

The reaction of markets is one of uncertainty on how to play the situation in the Middle East and what will be the consequences for crude oil supplies.

"Spikes in crude oil are likely inflated costs for society, particularly airlines and as these margins of pressurized." Investors are afraid now that the Libya disorders and other nations in the region could affect profits of corporations, at least in the short term.

"FTSE 100 exchanged by 5950 support levels today and should the UK Index close below that level today, it can open more downside pressure levels of support 5824 next."

Simon Denham, head of the capital spreads

"FTSE is slot pressure this morning in the area of 5950 medium with what is quite a level of support important."

"The speed with which nine is to sell investors disconcerting and this can easily be transformed into a panic, causing a move significant downward as the index has already pas take into account levels of support."

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