Another US strike on Iranian targets hit mine-laying boats and missile launch sites in southern Iran, though Secretary of State Marco Rubio said a deal could still be reached in a few days. This confrontation has severely reduced traffic through the Strait of Hormuz and driven up global costs for food, fuel, and fertiliser. In response to the deepening crisis, Rubio used a Quad meeting in New Delhi to condemn the attacks and unveil a new Indo-Pacific maritime surveillance plan. The most plausible near-term path involves a tense dual-track approach where Washington maintains military pressure while intermediaries like Qatar and Oman attempt to broker a limited arrangement.
EQUITY
Wall Street is conducting a stock buy-up toward record highs against sky-high valuations, compounded with inflation fears that have slashed the equity risk premium to post-dot-com bubble lows. This vanishing premium is squeezed by a global bond slump, where energy crises have fixed the 10-year Treasury yield up to 4.57%. Bullish investors argue that high corporate profits and a booming artificial-intelligence sector justify these prices, but sustaining this momentum is heavily contingent on a definitive Middle East peace deal to cool oil prices.
GOLD
Gold prices open the week by about 1% higher, to over $4,550, on reports that US-Iran negotiations were progressing, reducing the chances of a return to a rate-hike cycle. However, bullion subsequently lost some gains and slipped to $4,525 after US military strikes on Iranian targets. Overall, gold prices remain 13% to 15% lower since the conflict began.
OIL
Brent prices went from above $100 to almost $93 on Monday after markets are reacting to optimism surrounding a US-Iran framework that would extend a ceasefire for two months, lift the Washington blockade, and reopen the Strait of Hormuz. Although negotiations are reportedly progressing well and nearing an agreement, key issues remain unresolved, specifically Iran's nuclear programme and its demand for authority over the vital waterway's maritime traffic.
CURRENCY
The US dollar index steadied above 99.00, reversing previous losses after US military strikes against Iranian targets drained market optimism. Euro to eased to $1.163, while the British pound retreated to 1.3480 and the Japanese yen stabilized near 159.00 per dollar. Simultaneously, the Chinese yuan slipped against the greenback, rangebound from declining dollar and a milder central bank midpoint fixing aimed at maintaining stability.
