Morning Note: A Round-up of Global Financial Market News.
Market News
The US-Iran interim peace deal took effect, ending a blockade of the Strait of Hormuz, starting a 60-day countdown to reach a nuclear agreement and a more permanent peace deal. However, Brent moved back up to $80 per barrel as Israeli forces continued to strike Hezbollah targets in Lebanon. Ships crossing the reopened Strait of Hormuz should use a southern route near Oman that has been cleared of mines a naval group said. It warned of congestion amid ongoing mine-clearing operations in the main shipping channel.
Gold dropped to $4,150 an ounce on Friday, wiping out gains from earlier in the week as hawkish signals from the US Federal Reserve outweighed the positive impact of the US-Iran peace agreement, which pushed oil prices lower and eased inflation concerns. Goldman cut its year-end gold forecast by $500 to $4,900 an ounce. The yield on the US 10-year Treasury ticked back up to 4.46%.
US equities moved higher last night – S&P 500 (+1.1%); Nasdaq (+1.9%) – although they have drifted overnight on the futures market. The US market is closed today for a holiday. An index of Asian shares lost 1.1% after a five-day rally that took it to record highs. Once again, the outlier was Japan; the Nikkei 225 rose by 0.3%. A bipartisan duo of US senators urged Scott Bessent to step up co-operation with G7 countries to pressure China into addressing what they called a deliberate suppression of its exchange rate for commercial advantage.
The FTSE 100 is currently little changed at 10,397. Andy Burnham won a contest for an open parliamentary seat in Makerfield. He has assembled a team of advisors including former BOE chief economist Andy Haldane and ex-Goldman economist Jim O’Neill ahead of an expected bid for UK PM this summer. Sterling trades at $1.3195 and €1.1525, while the 10-year Gilt yields have risen by five basis points to 4.81%.
SpaceX bankers are preparing a potential bond sale of at least $20bn, people familiar said. The company received IG scores from the three major ratings firms. The fundraising drive is just the beginning of Elon Musk’s quest to raise tens of billions of dollars for AI.
Source: Bloomberg
