Investors Cautious Despite Oil Price Drop; Safe Havens Attractive Amid Geopolitical Tensions
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Oil prices and volatility in energy derivatives markets suggest investors still fear further spikes despite recent declines.
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Israel's bonds have recovered but credit default swaps imply a high risk of downgrade to junk status.
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Defense stocks have outperformed and are seen as long-term winners from increased military tensions.
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The Swiss franc hit 8-year highs versus the euro as investors sought safe havens, but remains overvalued long-term.
-European junk bond spreads versus risk-free assets often track oil prices, so further rises could test EU credit market resilience.