Market drivers and catalysts

• Equities: Wall Street rose before earnings, Europe closed mixed as tech slipped, Asia fell on Monday's Iran-driven risk-off
• Volatility: Weekend Iran strikes lifted oil and dented risk appetite, vol futures repriced ahead of CPI and Warsh
• Digital Assets: Crypto majors slid on the Iran risk-off bid, Circle secured its US national trust-bank charter
• Commodities: Oil rallies, metals retreat as renewed Middle East tensions dominate markets
• Fixed Income: US 2-year yields rises to 15-month high amid rate hike concerns
• Currencies:  JPY and AUD weakness underpin broad but moderate dollar bid
• Macro: Little of note ahead of CPI, PPI and Fed Chair Kevin Warsh's congressional testimony later this week

Macro

• Oil jumps after US and Iran exchanged fresh missile strikes as tensions around the Strait of Hormuz intensified. Iran claimed it had closed the strait, a move rejected by the US, and said it would not resume negotiations until Washington honours previous commitments on transit rights and oil exports. Meanwhile, the US launched new strikes targeting Iranian air defence systems, coastal radar installations, and missile and drone capabilities. In retaliation, Iran carried out drone and missile attacks against US allies across the Middle East, including Bahrain, Kuwait, and Qatar. 
• Fed and US economic data focus: Fed Chair Warsh will make his first congressional appearance since taking the helm after pledging to scale back forward guidance on the rate outlook. Tuesday’s House Financial Services Committee hearing will be preceded by June CPI figures. Then on Wednesday, shortly after the release of PPI data, Warsh will testify before a Senate committee. Earlier this month in Sintra, Portugal, Warsh said price risks have come down in recent weeks and repeated his determination to bring inflation back to the US central bank’s 2% target.
• More in our Macro Analysis & Macroeconomic News

Macro calendar highlights (times in GMT)

• OPEC Monthly Oil Market Report (during the day)

Earnings events

• Monday: Progressive, Fastenal
• Tuesday: JPMorgan, Bank of America, Goldman Sachs, Well Fargo & Co, Citigroup
• Wednesday: ASML, J&J, Morgan Stanley, BlackRock, Bank of New York, Cintas, United Airlines
• Thursday: UnitedHealth, GE Aerospace, Netflix, Seagate, Abbott Labs, Intuitive Surgical, U.S. Bancorp, State Street
• Friday: Travelers

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

S&P 500 7,575 +0.4%  |  NASDAQ 100 29,825 +0.3%  |  EURO STOXX 50 6,267 -0.3%  |  STOXX 600 641 FLAT  |  KOSPI 6,931 -7.3%  |  HANG SENG 24,149 -0.1%

• US stocks closed Friday higher in the run-up to earnings season, the S&P 500 up 0.4%, the Nasdaq 100 up 0.3% and the Dow adding about 150 points. The advance leaned on semiconductors after SK Hynix rose 12.8% in its 26.5 billion dollar debut, the largest ever by a foreign company on a US exchange, with Nvidia up 4% and AMD up 2%, while Intel fell 2.4%. Meta gained 6% on a favourable report on its AI compute business. Financials and cyclicals firmed as oil's rebound paused, easing near-term Fed rate-hike concern. Attention now turns to CPI on Tuesday and the first bank earnings.
• European equities ended Friday mixed after a volatile week, the Euro STOXX 50 down 0.3% and the STOXX 600 broadly flat. AI-linked technology names weighed, ASML down 1.9% and Siemens Energy off 2.6%, as investors pared exposure to the AI trade despite firm memory-chip demand. Banks were the offset, rising about 1.5% as BBVA, Deutsche Bank and UniCredit gained on another strong session for Eurozone bonds and easing oil. Both headline indices now sit roughly 2% below the record highs set the previous week. Investors turn to Wall Street's earnings season and Tuesday's US inflation print for direction.
• Asian equities came under pressure on Monday as the weekend strikes on Iran, firmer oil and a stronger dollar stalled last week's recovery. South Korea's Kospi led the retreat, sliding 7.3% as SK Hynix fell about 12% in Seoul after its New York debut, leaving the index down in five of the last six weeks despite a near-80% year-to-date rally. Hong Kong's Hang Seng held steadier, easing 0.1% after Chinese technology names rallied earlier this month on domestic AI-chip reports, while mainland shares and Japan's market also drifted lower. Energy names offered some support as Brent held above 78 dollars.
• More in our Equity Trading - Stock Market Analysis & News

Volatility

VIX 15.02  |  VIX FUTURES: 17.55  |  TERM STRUCTURE: CONTANGO  |  SKEW: ELEVATED (144.27)  |  MARKET REGIME: LOW-VOLATILITY BULL

• Fresh US strikes on Iran over the weekend lifted oil and pushed equity futures lower, S&P 500 futures off about 0.5% after Friday's near-record close and Kospi down 7.3%. Cash VIX ended Friday at 15.02 with VIX1D at 9.90, but the front VIX future rose 3.5% to 17.55, repricing near-term risk the Friday close had missed.
• The curve held firm contango, VIX9D 11.15 up to VIX3M 18.57, SKEW elevated at 144.27, MOVE subdued near 69.6. Pre-market SPXW implied about 79 points (1.04%) for Friday's expiry and roughly 35 for today's thin 0DTE, ahead of CPI Tuesday and Warsh's testimony.
• For a more detailed view on volatility, check our Options Briefs in the Options Insights

Digital Assets

BITCOIN ~62,763 -1.54%  |  ETHEREUM ~1,780 -1.42%  |  IBIT 36.23 +1.17%  |  ETHA 13.53 +2.58%

• Digital assets entered Monday on the back foot, spot sliding across majors as the fresh Iran escalation and firmer oil drove a broad risk-off bid. The move follows a mixed Friday for US-listed proxies: the ether ETF outpaced its bitcoin counterpart, while miners were mostly lower, MARA off 4.7% and CIFR down 4.9%.
• On the structural front, Circle received final approval from the US OCC to establish a national trust bank, First National Digital Currency Bank, giving its USDC stablecoin federally regulated custody and lifting its shares on Friday.

Commodities

• Oil prices jumped, with Brent trading near USD 80 per barrel, after the battle for control over the Strait of Hormuz escalated over the weekend. Fresh strikes by US and Iran renewed concerns about the safe passage of oil and other key commodities through the narrow waterway. The hostilities also risk derailing efforts to rebuild inventories, according to the IEA, while further reducing the prospects for a diplomatic resolution. Even so, the relatively modest premium between front-month and deferred futures suggests the physical crude market remains orderly for now. The main focus continues to be refined products, where already tight market conditions - recently exacerbated by Russia's diesel export ban - are adding to inflationary pressures.
• Precious and industrial metals are once again under pressure as renewed hostilities in the Gulf rekindle concerns about inflation and the risk of further Federal Reserve tightening, creating additional headwinds through higher bond yields and a stronger dollar. Gold is down 1.4%, silver has fallen 2.5%, and copper trades 1.3% lower. Aluminium, by contrast, is up around 0.5% amid renewed concerns about potential supply disruptions from Persian Gulf producers. On the monetary policy front, traders will closely watch Fed Chair Kevin Warsh as he begins his first two-day congressional testimony on Tuesday.
• More in our Commodity News, Analysis & Commentary

Fixed Income

• Treasury yields rose by around two basis points across the curve as renewed Middle East hostilities and the resulting rebound in oil prices reignited inflation concerns. The benchmark 10-year Treasury yield climbed to 4.58%, while the policy-sensitive two-year yield rose to a 15-month high of 4.23%. The rates market is now fully pricing in a Federal Reserve rate hike by October.

Currencies

• The dollar strengthened againstall its G10 peers on renewed geopolitical tensions and as higher oil prices fueled speculation that the Fed will raise rates to cool inflationary pressure. Overall, however, the changes so far are limited with the Dollar index trading near unchanged at 101 having touched 101.22 earlier in the Asian session. 
• USDJPY climbed to 162.05, hovering near its 52-week highs, with the yen notably failing to attract its traditional safe-haven inflows despite the risk-averse environment, while commodity currencies underperformed, with AUDUSD and NZDUSD easing, reflecting sensitivity to global growth and risk sentiment.
• EURUSD held steady at 1.1400, showing relative resilience even as the broader dollar gained ground.
• More on currencies in our dedicated section: Forex Trading News & Analysis