Equities: Tech Rally Loses Steam
Asian equities weakened alongside European and U.S. futures as the recent technology-led rally lost momentum. U.S. megacap tech weakness weighed on sentiment, with investors reassessing stretched AI valuations and the prospect of higher-for-longer interest rates.
Oil: Geopolitical Risk Premium Eases
Oil extended its decline as markets awaited further progress in U.S.-Iran talks. Optimism over negotiations and continued traffic through the Strait of Hormuz eased immediate supply-disruption concerns, reducing the geopolitical risk premium in crude.
Yen Intervention Risk in Focus
The yen erased earlier losses after Japanese Finance Minister Satsuki Katayama said she spoke with U.S. Treasury Secretary Scott Bessent and reaffirmed that "decisive action" could be taken if needed. Traders remain alert to possible intervention as USD/JPY trades near multi-decade extremes.
UK Political Uncertainty Fades
Sterling stayed in focus after JPMorgan reinstated a bullish view on the pound, supported by fading UK political uncertainty. Markets are watching whether a smoother leadership transition can stabilise sentiment toward gilts and the currency.
Gold Forecasts Cut
Gold sentiment softened after Deutsche Bank cut its price forecasts by up to 22%, citing fading expectations for U.S. rate cuts, resilient macro data, and weaker investor demand. The bank now sees bullion at $4,300 in Q3 and $4,800 in Q4, while central-bank buying remains a key support.
Key Events
- Eurozone, UK, and U.S. June PMIs
- Speeches from the ECB's Vujčić and the BoE's Taylor and Dhingra
Key Market Moves Today
- WTI Crude: -1.0% ($73.14)
- S&P 500 Futures: -0.9% (7,471.25)
- Gold: -1.6% ($4,121.7)
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