Key insights
- US equity futures are up, driven by cooling US-Iran tensions and stabilization of Treasury yields, leading to some repricing of rate cut expectations. However, elevated energy prices due to the closed Strait of Hormuz are acting as a slight headwind. Gold is up and the dollar is weakening, reflecting risk-on sentiment but also some uncertainty.
Markets continued to trade with remarks from the White House top of mind after President Trump stated he foresaw the U.S.-Iran conflict concluding within two to three weeks. Treasury yields stabilized as traders began re-pricing a chance of a rate cut this year. However, fairly measured cooling in crude prices kept a lid on stocks as the Strait of Hormuz remains closed and energy prices remain elevated with little direction on how the waterway may reopen. Gold traded higher and the dollar weakened.