Stocks in Asia and Europe traded a bit higher, while oil prices were effectively unchanged on the first business day after the United States carried out a large-scale military operation in Venezuela and captured the country’s president.
In the United States, Dow futures were broadly flat, while S&P 500 futures signaled a 0.3% rise in early trading.
US and European companies may now gain greater access to Venezuela’s vast mineral resources, noted Mohit Kumar, an economist at Jefferies. But overall, “there are too many uncertainties to contend with” for markets to price in at this stage, he wrote in a note.
Similarly, Deutsche Bank analysts noted that geopolitical shocks historically don’t tend to have a lasting impact on stock markets – unless those events first affect key economic indicators, such as inflation.
The developments in Venezuela also had a limited impact on oil prices, with Brent, the global benchmark, 0.1% down.
Amrita Sen, the founder of research firm Energy Aspects, pointed to ample oil supply globally, saying “there isn’t really any fear of shortages” as a result of the weekend US strikes on oil-rich Venezuela.
Conversely, expectations of a ramp-up in oil flows are muted. “Venezuela does have fantastic reserves, but our calculations show that just to raise production by half a million barrels per day would require at least two years and $10 billion,” Sen told CNN’s Rahel Solomon.
Meanwhile, gold prices rose 2.7% as investors sought out safe-haven assets.