UN envoy due in Yemen as strains escalate with Houthi missile launch

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Time: June 25, 2018

The Iran-aligned Houthi movement fired missiles at the Saudi capital Riyadh late on Sunday, escalating tensions ahead of a visit by the U.N. envoy to Yemen this week to try to avert a military assault on the country’s main port city.

A Houthi spokesman threatened more attacks in response to the offensive launched by a Saudi-led coalition on June 12 to seize control of Hodeidah port, long a key target, in an attempt to weaken the Houthis by cutting their main supply line.

The United Nations fears an assault on the Red Sea port, a lifeline for millions of Yemenis, could trigger a famine imperiling millions of lives.

The offensive could also have ramifications further afield due to Yemen’s role in a proxy war between Sunni Muslim Saudi Arabia and Shi’ite Muslim Iran that has fuelled instability across the Middle East.

The coalition said on Monday that eight members of Lebanon’s Shi’ite Hezbollah group had been killed in battles in the mountainous Saada region in Yemen’s northwest, which is held by the Houthis along with the capital Sanaa.

Hezbollah officials could not be immediately reached for comment, but the group has previously denied Saudi accusations that it is helping Houthi rebels.

U.N. envoy Martin Griffiths was due to arrive in the southern city of Aden on Wednesday for talks with ousted President Abd-Rabbu Mansour Hadi in the exiled government’s temporary capital, government officials said.

“He will only be there for a few hours and the talks will focus on the situation in Hodeidah and (on) averting any military operation on the port,” one official told Reuters.

MISSILES OVER RIYADH

Saudi air defence forces intercepted two rockets over Riyadh late on Sunday, sending debris measuring up to several metres hurtling towards residential areas.

Pieces fell near the U.S. mission in the Saudi capital and at a school in the diplomatic quarter. Debris sparked a fire at a construction site 10 km (six miles) further south and fell on the roof of a private residence, but Saudi officials said there were no casualties.

“Our rockets will reach places that the enemy will not expect,” Houthi spokesman Mohammed Abdul-Salam said. “The longer the aggression and war continue, the greater our ballistic missile capabilities.”

Coalition spokesman Turki al-Malki said the alliance’s advances on Hodeidah and other fronts were pushing the Houthis to try to project strength through such attacks.

Coalition-backed forces seized Hodeidah airport last week and have been consolidating their hold in the area as more Houthi fighters, mostly armed with Ak-47 assault rifles, were deployed in the city and around the port.

The United Nations fears heavy fighting will worsen what is already the world’s most urgent humanitarian crisis, with 22 million Yemenis dependent on aid and an estimated 8.4 million believed to be on the verge of starvation.

The Houthis have indicated they would be willing to hand over management of the port to the United Nations, sources told Reuters. A U.S. official said Washington was urging the Saudis and Emiratis to accept the deal.

The Arab states say they must recapture Hodeidah to deprive the Houthis of their main source of income and prevent them from smuggling in Iranian-made missiles, accusations denied by the group and Tehran.

The coalition has pledged a swift military operation to take over the airport and seaport without entering the city centre, to minimise civilian casualties and maintain the flow of goods. (Writing by Ghaida Ghantous; Editing by William Maclean)

(Reuters) – A mini rally in U.S. stocks, sparked by a U.S. move to ease its stance on curbing Chinese investments in American technologies, ran out of steam in afternoon trading on Wednesday, but a jump in oil prices helped prop markets.

President Donald Trump said he will use a strengthened national security review panel — the Committee on Foreign Investment in the United States (CFIUS) — to deal with potential threats from Chinese acquisition of U.S. technology, instead of imposing China-specific restrictions.

The decision marks a somewhat softer approach to curbing Chinese investments than reports on earlier plans to block firms with at least 25 percent Chinese ownership from buying U.S. tech firms.

“Nothing today came out other than commentary from the administration. The problems that we’re dealing with in the market isn’t going to be allayed by a couple of interviews,” said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee.

“We’re going to need significant commentary from the President, trade advisers about where this is all going.”

After an initial rally, the S&P technology .SPLRCT and industrial .SPLRCI sectors — which have a relatively higher revenue exposure to China – fizzled. Tech stocks fell 0.63 percent, while industrials held a slim 0.15 percent gain.

The drop was relatively steeper in chipmakers, which on average get about a quarter of their revenue from China. The Philadelphia semiconductor index .SOX slid 1.4 percent.

“I think it’s still likely that chip stocks are a point of contention between the U.S. and China. So when they drop so low, they get interesting to investors and they come back to a place where fear kicks in again,” said Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh.

.DJIDOW JONES INDEXES
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  • .DJI
  • .SPX
  • .IXIC
  • GE.N
  • CAG.N

At 13:39 ET the Dow Jones Industrial Average .DJI was down 16.21 points, or 0.07 percent, at 24,266.90, the S&P 500 .SPX was down 5.62 points, or 0.21 percent, at 2,717.44 and the Nasdaq Composite .IXIC was down 54.88 points, or 0.73 percent, at 7,506.75.

The S&P energy index .SPNY was up 1.6 percent, leading the gainers among the 11 major sectors, lifted by a jump in U.S. crude price as plunging stockpiles compounded supply concerns. [O/R]

Among stocks, General Electric (GE.N) gained about 3.2 percent, riding the optimism from the industrial conglomerates’ restructuring plans announced on Tuesday.

Conagra (CAG.N) dropped 6.9 percent after the company said it would buy Pinnacle Foods (PF.N) for about $8.1 billion in cash and stock. Pinnacle Foods fell 4.1 percent after the widely anticipated deal announcement.

Declining issues outnumbered advancers for a 1.62-to-1 ratio on the NYSE and a 2.81-to-1 ratio on the Nasdaq.

The S&P index recorded 12 new 52-week highs and 11 new lows, while the Nasdaq recorded 49 new highs and 58 new lows.

This article was first published in Reuters

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