Stocks and the dollar rose today, oil tumbled and traditional safe haven assets fell sharply as US forces thrust towards Baghdad, raising investor expectations of a quick end to the war in Iraq.
Wall Street was poised to open higher while safe-haven gold slid as much as $4 an ounce and prices of risk-free government debt fell sharply as investors sensed the US-led war to oust Iraqi leader Saddam Hussein could be over sooner than seemed likely earlier this week.
A Reuterspoll of fund managers, taken only yesterday, gave a consensus view that the war would last six more weeks, double the time envisaged in a similar poll taken on the day war began. However, this expectation may have been scaled back by the events of the past 24 hours.
European shares soared. The FTSE Eurotop 300 index of pan-European blue chips was 2.82 per cent higher and the narrower DJ Euro STOXX 50 index was up 3.58 per cent.
US stock index futures were higher, indicating Wall Street would add to yesterday's gains.
Japan's Nikkei index ended 1.04 per cent higher while the broader TOPIX index gained 1.09 per cent.
On the foreign exchange market, the dollar soared nearly a cent against the euro and one percent against the Swiss franc. The euro eased to $1.0808 from New York's close at $1.0909 and a two-week high of $1.0960 hit in early trade. The dollar was at 118.94 yen, up from a two-week low of 117.60 in early Asian deals.
Gold, viewed as a safe investment in times of geopolitical turmoil, fell sharply. Spot gold was at $330.00 an ounce, down from $334.00 at yesterday's New York close.
"Stock market volatility has been hit pretty hard, so there's been a wave of risk aversion fading away, which is always bad for gold," said Hans Witting, director with NM Rothschild.
Oil prices were lower. US light crude for May was down $1.06 a barrel at $28.72 and Brent crude was 89 cents a barrel lower at $25.48, off the day's lows.