Market drivers and catalysts

• Equities: US and Europe fell on chip weakness, Asia stayed volatile as Korea sold off and oil worries returned.
• Volatility: US strikes on Iran lifted oil and revived geopolitical risk, FOMC minutes ahead
• Digital Assets: Crypto equities and miners retreated with tech while spot eased overnight on the geopolitical risk-off
• Commodities: Oil jumps as ceasefire is tested; gold holds despite clouded inflation and rate outlook
• Fixed Income: US Treasury yields moved higher along the curve
• Currencies: Modest USD gain despite fresh Middle East turmoil
• Macro: FOMC minutes and US auction of 10-year Notes

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Macro

• Oil prices rose again as US–Iran tensions escalated after the US launched new airstrikes on Iranian weapon sites, air defenses, and coastal targets in response to attacks on three commercial vessels, including a Qatari LNG carrier and a Saudi tanker, near the Strait of Hormuz, while the Treasury revoked Iran’s oil export waiver, marking the sharpest US–Iran escalation since their memorandum of understanding less than three weeks ago.
• The Atlanta Fed's GDPNow model revised its Q2 US GDP growth estimate up to 1.36% from 1.19% previously, still below Bloomberg consensus of 2.47%. This following the May trade data release showed a 42.2% month-on-month rise in the deficit to $77.6 billion, the largest since March 2025, as exports fell 3.2% and imports rose 3.3%
• The New York Fed’s one-year inflation expectations rose to 3.7% in June and three-year expectations to 3.3%, while the five-year outlook stayed at 3.0%. Gas price expectations fell to 1.5%. Job security perceptions improved, households felt financially better off than a year ago but more expect tighter credit ahead.
• More in our Macro Analysis & Macroeconomic News

Macro calendar highlights (times in GMT)

• 1100 – US MBA Mortgage Applications
• 1430 – EIAs Weekly Crude and Fuel Stocks Report
• 1700 – US to sell USD 39 billion 10-year Notes
• 1800 – FOMC Minutes from 17 June Meeting

Earnings events

• Wednesday: Kongsberg Gruppen
• Thursday: Pepsico, Fast Retailing, Progressive, Cintas, Seven and I Holdings
• Friday: Delta Airlines

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

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Equities

• USA: The S&P 500 fell 0.5%, the Nasdaq 100 dropped 1.8%, and the Dow lost 0.3% as Samsung’s strong but not-strong-enough earnings sparked a global chip selloff. Intel sank 9.7% and AMD fell 6.5% as investors questioned how much AI optimism was already priced in. The weakness spread beyond technology, with Caterpillar down 3.1% and Deere 5% lower as machinery momentum unwound. Fiserv rose 1.8% on reports that US banks may explore a deal for its debit network, while markets now watch Fed minutes and AI-linked earnings signals.
• Europe: The Stoxx 600 fell 0.7%, the DAX dropped 1.4%, and the Euro Stoxx 50 lost 1.2% as Europe joined the global technology retreat. Chip-linked shares led the decline, with ASML down 7.3% and Soitec tumbling 17.1% after Samsung’s results reset expectations for the semiconductor trade. Siemens Energy fell 8.9% after Barclays cut the stock to underweight, warning that valuation now looks stretched after its sharp AI-power infrastructure rally, adding pressure outside pure technology. The FTSE 100 rose 0.1% as Shell gained 3.4% on higher oil prices, while Swiss defensives helped the SMI rise 0.4%. Investors now watch whether this is a wobble or a wider AI valuation check.
• Asia: Asian markets fell sharply on Tuesday as South Korea’s Kospi dropped 4.9% after Samsung Electronics and SK Hynix sold off despite Samsung’s record quarterly results. The Korea Exchange briefly triggered a circuit breaker on program selling, a reminder that even AI darlings can trip over their own shoelaces. Hong Kong’s Hang Seng fell 0.5%, with Kuaishou down 12.0% after Tencent sold a $1.5 billion stake, while the CSI 300 lost 1.0%. Singapore outperformed, with the Straits Times Index up 1.6% as OCBC gained 3.3%. Fresh US strikes on Iran keep oil and risk sentiment in focus today.
• More in our Equity Trading - Stock Market Analysis & News

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Volatility

VIX 16.13 | VIX FUTURES: 17.50 | TERM: CONTANGO | SKEW: ELEVATED (145.74) | REGIME: LOW-VOLATILITY BULL

• Geopolitics has displaced the AI-valuation theme: US airstrikes on Iran and a revoked oil waiver lifted crude 2.6% and pushed Asian equities lower, with Kospi falling over 5% on a chip rotation. The S&P 500 closed Tuesday down 0.45% at 7,503.86. VIX rose 3.6% to 16.13 and VIX1D jumped 22% to 10.66.
• The term structure held its contango up to VIX3M 19.01, while SKEW stayed elevated at 145.74, oil volatility climbed 18%, and MOVE firmed to 70.25. The SPX weekly expected move is about 64 points, or 0.85%, for Friday's 10 July expiry, with FOMC minutes today the key catalyst.
• For a more detailed view on volatility, check our Options Briefs in the Options Insights

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Digital Assets

BITCOIN ~63,125 -1.3% | ETHEREUM ~1,770 -1.6% | IBIT 36.12 +3.58% | ETHA 13.55 +5.37%

• Digital assets turned defensive, tracking Tuesday's technology and chip-led retreat before the overnight risk-off from the Middle East escalation. Crypto-linked equities and miners fell broadly in the prior session: Coinbase and Strategy each dropped over 3%, while miners led the decline, paced by a 9.3% fall in Iren.
• On the structural front, the US administration is reviewing its legal authority before establishing a strategic Bitcoin reserve, while miner TeraWulf signed a twenty-year agreement to supply AI data-centre capacity to Anthropic.

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Commodities

• Oil rose after the US struck targets in Iran and revoked a waiver allowing new sales of Iranian oil, in retaliation for Iranian attacks on ships in the Strait of Hormuz. The escalation threatens fragile negotiations aimed at securing a permanent peace, with both sides accusing the other of violating the ceasefire. Three commercial vessels were attacked in the Strait over the past day, the most since the agreement took effect, with the US blaming Iran for the strikes. Brent has moved back above USD 76, potentially triggering further short covering among hedge funds.
• Gold initially fell as renewed oil-price strength clouded the inflation and rate outlook. However, despite 10-year real yields trading near an 18-month high and adding to the headwinds facing non-yielding assets, bullion has so far found support around USD 4,100. The resilience supports our view that gold may be shifting from capitulation to consolidation. Focus remains on oil prices and bond yields amid incoming auctions of long-dated US Treasuries.
• More in our Commodity News, Analysis & Commentary

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Fixed Income

• US Treasury yields moved higher along the curve amid rising oil prices, incoming debt auctions and concerns over AI-related capex. At the long end, the 10-year yield climbed to 4.55% and the 30-year to 5.06%, both their highest levels since May. The Treasury will sell USD 39 billion of 10-year notes today, followed by USD 22 billion of 30-year bonds on Thursday. The selloff has also lifted the 10-year real yield to an 18-month high of 2.27%, adding some headwinds to non-yielding assets.
• Markets are repricing inflation risk after the Iran oil waiver revocation, modestly increasing odds of Fed hikes in September and October, with one-year inflation swaps backing up and the curve steepening as the front end remains anchored by policy expectations while the long end bears the brunt of structural supply pressures.

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Currencies

• USD traded generally firmer overnight as US military strikes on Iran, including moves to block Iranian oil exports, pushed oil prices sharply higher, reignited inflation concerns, and lifted US Treasury yields. EURUSD slipped but held above 1.1400 as geopolitical risks around the Strait of Hormuz undermined the euro’s bullish case, while GBPUSD eased to 1.3350, breaking a multi-session uptrend amid a risk-off tone.
• USDJPY nudged higher above 162, supported by firmer US yields and higher oil, with BOJ comments that rate hikes could slow growth tempering any yen support despite discussion of possible changes to policy wording.
• NZD rose after the RBNZ raised its key interest rate by 25 basis points to 2.5% the first hike in three years and signaled potential for more hikes to drive inflation back down to target. The heavily shorted currency by futures traders rose above 0.57 after recently hitting a seven-month low at 0.5625
• More on currencies in our dedicated section: Forex Trading News & Analysis