Stocks slip, oil jumps as Trump calls for Tehran evacuation

US stock futures slipped and oil prices rose on Tuesday, as investors were rattled by US President Donald Trump's call for everyone to evacuate Tehran with the fifth-day of Israel-Iran fighting sowing fears of a broader regional conflict.

Markets were on edge after a separate report said that Trump had asked for the national security council to be prepared in the situation room as he cut short his visit to the Group of Seven summit in Canada.

Trump had earlier urged everyone to immediately evacuate Tehran, and reiterated that Iran should have signed a nuclear deal with the United States.

The latest developments sparked a wave of risk-off moves in early Asian trading. S&P 500 futures EScv1 fell 0.46%, European futures STXEc1 slumped 0.69%, while crude prices CLc1, LCOc1 briefly jumped more than 2%. O/R

"Suspicion is that we're about to see the US begin some sort of military action in Iran and we're now seeing some risk aversion because it brings another element of uncertainty into the market," said Tony Sycamore, a market analyst at IG.

Wall Street had closed higher on Monday after sources told Reuters that Iran was seeking a Trump-mediated immediate ceasefire with Israel, which also cooled a rally in crude prices.

The Iran-Israel air war - the biggest battle ever between the two longtime enemies - escalated on Monday with Israel targeting Iran’s state broadcaster and uranium enrichment facilities.

The heightened uncertainty and fluid Middle East situation bolstered investor moves towards traditional safe-haven assets such as gold XAU= which rose 0.5%, while a rise in US Treasuries pushed yields lower across the curve. The yield on the benchmark 10-year note US10YT=RR was down about 2 basis points at 4.43%.

The dollar =USD firmed against the euro EUR=, yen JPY= and sterling GBP= as it reprised its role as a safe asset even as it held to broadly tighter ranges.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was a tad higher, while futures tracking Hong Kong's Hang Seng index HSIc1 were also marginally higher.

Outside of geopolitics, interest rate decisions by a host of central banks will be the prime focus for investors this week with the Bank of Japan's verdict expected later in the day.

At the end of its two-day policy meeting, the BOJ is widely expected to maintain short-term interest rates at 0.5%, but markets will be keen on the institution's outlook on quantitative tightening.

Japan's Nikkei .N225 edged up 0.5%, while the yen JPY= was slightly weaker at 144.96 per dollar.

Investors are expecting the BOJ to consider slowing reductions in its bond purchases next year, as the central bank focuses on avoiding big market disruptions and tries to wean the economy off a decade-long, massive stimulus.

It would be the first decision since the recent bond auctions had shown eroding appetite for freshly issued longer-dated debt and drove the country's bond yields to record highs. On Tuesday, yields on 30-year GB30YT=RR and 40-year GB40YT=RR bonds were broadly steady.

In a week filled with central bank meetings across the globe, investors will be looking to comments from officials as they navigate Trump's erratic tariff policies and their impact on the global economy.

The Federal Reserve is expected to hold rates steady on Wednesday but the focus yet again will be on the path Fed Chair Jerome Powell charts out for future rate cuts. Traders are pricing in two cuts by the end of the year. 0#USDIRPR

"To be a central banker right now is one challenging job and on top of the tariff situation, the trade policy and the inking of deals before deadlines you have this uncertainty from the Middle East," said IG's Sycamore.

"Macro backdrops don't get any more tricky than what we're seeing at this point in time."

In commodities, the risks of prolonged unrest in the Middle East and disruption to oil supply sent prices higher. Brent crude futures contract LCOc1 was last up 0.34% at $73.47 a barrel. West Texas Intermediate crude CLc1 was last up 0.43% at $72.09.

Gold prices XAU= were fetching $3,393.05 per ounce, up 0.3% on the day. GOL/