Bin Laden: A life of fanaticism and terror
Osama bin Laden dead: Analysts react

Market analysts react to Osama’s death

The death of Osama bin Laden may affect the stock markets and businesses,say analysts.

Al Qaeda leader Osama bin Laden was killed on Sunday in a firefight with U.S. forces in Pakistan and his body was recovered,U.S. President Barack Obama said.

After searching in vain for the al Qaeda leader since he disappeared in Afghanistan in late 2001,Obama said U.S. forces led the operation that killed the Saudi-born extremist.

COMMENTS:

TETSU AIKAWA,DEPUTY GENERAL MANAGER OF CAPITAL MARKETS,SHINSEI BANK,TOKYO:

It is reasonable to expect an improvement in U.S. consumer sentiment,but that may not be enough to change the course of the U.S. economy. I don’t expect the chance of less U.S. involvement in Afghanistan to lead to an improvement in U.S. public finances.

This could increase flows into risk assets like yen and dollar carry trades. It’s also possible for some European sovereigns spreads to tighten.

Given the unrest in places like Syria and Yemen,there is still a chance of democracy spreading like dominoes through the Middle East and North Africa. In the short term this might be a cause of worry,but this is something that markets would welcome in the long term.

CHIP HANLON,PRESIDENT,DELTA GLOBAL ADVISORS,HUNTINGTON BEACH,CALIFORNIA:

I’m not sure there will be much of a market reaction. He is a figurehead and there is a feel good value in knowing he is gone. But most people think (al Qaeda deputy Ayman) al-Zawahri has been running it for a while now.

There some feel good value and market will like that. There will be a boost for the appropriate politicians,primarily the commander in chief. It doesn’t change much about the energy situation and doesn’t change much about the ongoing battle with radical Islamists.

It’s sort of like the news when we heard Saddam was caught,in the end it didn’t change much fundamentally and I don’t think this will either.

KEN HASEGAWA,COMMODITY DERIVATIVES SALES MANAGER,NEWEDGE,TOKYO:

Absent other news,the death sparked selling in oil and gold,and buying in stocks. But it has only had a passing impact and the markets will eventually return to normal.

It’s not that bin-Laden suspended the crude oil production,although he had some influence as a whole. But it does not mean that all the terrorism acts will be gone because of this.

MOHAMED EL-ERIAN,CHIEF EXECUTIVE OFFICER AND CO-CHIEF INVESTMENT OFFICER,PIMCO:

In reflecting the news on Bin Laden,markets will balance the durable impact of a reduction in a security risk with the possibility of isolated disturbances in some parts of the Middle East and central Asia.

By lowering national security risks overall,this is likely to bolster equity markets and lower U.S. Treasury prices in a reverse flight to quality movement.

Oil markets are likely to be the most volatile given their higher sensitivity to the tug of war between lower risk overall and the possibility of isolated disturbances in some parts of the Middle East and central Asia.

PETER KENNY,MANAGING DIRECTOR,KNIGHT CAPITAL GROUP JERSEY CITY,NEW JERSEY:

Geopolitically this will have an enormous impact on unrest in the Middle East. It won’t be purely positive for markets because it could lead to further instability in the Middle East.

It certainly will help the flagging fortunes of the current president of the United States. Generally speaking markets will have a very positive view of this and it will be well deserved.

(U.S.) markets have evolved beyond Osama bin Laden to the extent that they have reverted back to traditional metrics of risk and it’s all about earnings.

LARRY SABATO,PROFESSOR OF POLITICAL SCIENCE,UNIVERSITY OF VIRGINIA (COMMENT ON TWITTER):

This is a giant political plus for Barack Obama.

Almost 100 percent of Obama’s political enemies will cheer him for this one. Imagine the 2012 TV ad.

DAVID LENNOX,COMMODITIES AND MINING ANALYST,FAT PROPHETS,SYDNEY:

There is always a reaction in commodities to news of this nature. The markets will always react quickly,and in this case it is someone who has been held out as the father of all terrorism.

But any easing we might see in oil or gold markets,in my view will be short-lived. The longer-term impact will not be substantial.

JONATHAN BARRATT,MANAGING DIRECTOR,COMMODITY BROKING SERVICES,SYDNEY:

It is all about erosion of risk premium. If Osama is taken out,you are going to see risk premium being wiped out from the market. It is going to bring down oil prices by $5 to $10 if people warrant that risk premium is important.

TOMOMICHI AKUTA,SENIOR ECONOMIST,MISTUBISHI UFJ RESEARCH AND CONSULTING,TOKYO: on oil markets

This is a bear factor. I take this as a factor that would ease worries about geopolitical risks.

IMATIAZ GUL,SECURITY ANALYST,PAKISTAN:

Obviously his (Osama bin Laden) supporters wherever they are,they would try to stage some sort of protest,but I don’t really expect any sort of large protests.

The common Pakistani is so hard-pressed right now because of the other problems and there is only a small portion of support for Osama bin Laden,because of the way this has affected the country in the last 10 years.

For some time there will be a lot of tension between Washington and Islamabad because Bin Laden seems to have been living here close to Islamabad. If the ISI (Inter Services Intelligence) had known then somebody within the ISI must have leaked this information. Pakistan will have to do a lot of damage control because the Americans have been reporting he is in Pakistan and he turns out to be in Islamabad. This is a serious blow to the credibility of Pakistan.

RODOLFO MENDOZA,PRESIDENT,PHILIPPINES INSTITUTE ON PEACE,VIOLENCE AND TERRORISM RESEARCH,PHILIPPINES:

It’s a major tactical victory for the U.S. security community,but I expect that the disruption to al Qaeda terror operations will be temporary. I still don’t see the end yet for global Islamist militancy.

Osama bin Laden is a global symbol of Islamist extremism but there could be other militants lining up to replace him.

He had established a wide network moving independently but with the same goal in the Middle East,Pakistan,Afghanistan and even in Southeast Asia.

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