Market Summary
US-Iran Tensions Ease as Technical Talks Continue, Oil Stabilises: The U.S. and Iran are continuing technical talks following two days of reciprocal airstrikes, according to a person familiar with the matter, helping calm concerns that the conflict could escalate into a broader disruption to energy supplies. Brent crude steadied after falling 3.66% yesterday from $78.94 to $76.03 per barrel and is trading modestly higher this morning at $76.68. As geopolitical risk premiums eased, the U.S. 10-year Treasury yield slipped to 4.54% as investors pared expectations of a prolonged energy-driven inflation shock.
Technology Shares Rebound as AI Optimism Returns: With Middle East tensions appearing more contained, investors rotated back into technology stocks on renewed confidence that the artificial intelligence investment cycle remains intact. After this week's pullback, investors viewed the weakness as a buying opportunity ahead of the upcoming earnings season. Supporting the theme, Micron Technology announced plans to increase spending on new U.S. manufacturing facilities to $250 billion to meet AI-driven demand, with its shares rising 1.1% in extended trading.
Yen Strengthens as Japan Pushes Domestic Investment; Precious Metals Rally: The Japanese yen strengthened after lawmaker Satsuki Katayama called for pension funds to increase allocations to domestic assets. USD/JPY fell from 162.40 to 161.55, a decline of approximately 85 basis points, while longer-dated Japanese government bonds also advanced. Meanwhile, gold rebounded 1.19% from $4,075 to $4,118 per ounce, with silver outperforming and gaining 3.54% to $59.95, as investors added exposure to precious metals despite easing geopolitical tensions.
Economic Calendar
- German CPI
- France CPI
- Russian CPI
- Italy Industrial Production
- Canadian Employment Data
Key Market Moves Today
- S&P 500 Futures: -0.07% (7,583)
- U.S. 10-Year Yield: -1.20 bps (4.54%)
- Brent Crude: +0.50% ($76.68)
- Bitcoin: +1.04% ($63,922)
- Spot Gold: -0.14% ($4,118)
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