Morning Note: A Round-up of Global Financial Market News.
Market News
Renewed clashes between the US and Iran weakened hopes for a near-term peace agreement and reignited inflation concerns. US Central Command said American forces intercepted Iranian attacks and launched defensive strikes while guided missile destroyers moved through the Strait of Hormuz, while stressing that the military does not seek further escalation. Meanwhile, the Trump administration is awaiting Iran’s response to a proposal aimed at reopening Hormuz and ending the nearly 10-week conflict, with reports indicating that Tehran is expected to respond through Pakistan within the next two days.
Brent crude futures climbed to $101 a barrel, recouping some losses from earlier in the week, while gold is trading up at $4,715 an ounce after experiencing sharp volatility in the previous session.
The US jobs report for April will probably show net hiring growing by a modest 65,000, down from March’s 178,000. The whisper number is more optimistic. The yield on the US 10-year Treasury slipped to 4.38%.
US equities pulled back last night – S&P 500 (-0.4%); Nasdaq (-0.1%) – with the negative trend continuing in Asia this morning: Nikkei 225 (-0.2%); Hang Seng (-0.7%). The Japanese yen is trading near 157 per dollar and is set to end the week little changed, as intervention fears and fresh verbal warnings from Tokyo failed to sustain the recent rally.
The FTSE 100 is currently 0.8% lower at 10,217. The Board of Intertek Group rejected a revised £58-a-share proposal citing significant undervaluation while confirming inbound interest in its Energy & Infrastructure division.
English local elections appear to have delivered a clear (and expected) negative verdict on the Starmer government. With results declared from around a quarter of councils, Reform UK has surged, with sweeping gains in former Labour strongholds. Six mayoral contests and several London boroughs remain to be finalised today, but the pattern is consistent: voter frustration over the economy, immigration and taxes has produced a seismic shift in local representation. In Scotland and Wales, polling closed yesterday for the Holyrood and expanded Senedd elections. Counting begins this morning with no seats declared. Energy Secretary Ed Miliband privately urged Keir Starmer to set a resignation timeline, The Times said.
Sterling trades at $1.3585 and €1.1565, while the 10-year gilt yield has slipped to 4.95%.
President Trump’s latest 10% tariffs were declared unlawful by a US trade court. The president gave the EU a 4 July deadline to ratify his deal and threatened to raise duties on the bloc.
Source: Bloomberg
