Market News

Mizuho's note points to a technical breakdown with real teeth, since momentum baskets slipping below the lows set during July's Situational Awareness unwind (Mizuho referring to Morgan Stanley's Tech Momentum Index) means the market has now erased the entire rebound that followed that earlier liquidation event. The self-reinforcing dynamic Mizuho describes, where falling prices trigger further systematic de-risking, is the same mechanism that made the July move so violent, and it tends to accelerate once key technical levels give way. This latest leg lower is unfolding against a backdrop of rising bond yields and oil prices tied to the escalating US Iran conflict, adding a macro overlay to what started as a positioning and factor unwind.…

Crude has been grinding higher through the week on the back of this escalation, with prices pushing toward their highest level in more than a month as the market prices in a prolonged disruption to exports rather than a quick de-escalation. Traders are increasingly focused on the mechanics of the standoff itself, including the scale of the US naval blockade around Iranian ports and the risk of further mining attempts in the Strait, rather than any single headline. With the US Strategic Petroleum Reserve already near multi-decade lows and no clear diplomatic off-ramp in sight, the geopolitical premium embedded in oil prices looks unlikely to unwind quickly. Attention now turns to whether Iran responds with further strikes on US assets or…

Schroders' gold upgrade adds to a growing list of asset managers pointing to central bank demand as the structural underpin for prices, even after this year's sharp rally, suggesting institutional flows rather than retail momentum are driving the medium term case. The firm's decision to pair that with continued equity and technology exposure signals confidence that the current cycle has further to run, though its own acknowledgment that valuations sit in extended territory points to a market increasingly reliant on growth and earnings delivering without disappointment. The tactical tilt toward US Treasuries on attractive real yields suggests Schroders sees limited near term inflation risk, a view that would come under pressure quickly if…

UBS's call rests on a widening gap between the front and back end of the curve, with long yields pricing in structural fiscal and issuance risk while short yields still have room to fall as disinflation takes hold. That divergence looks harder to defend after Tuesday, when yields across the curve pushed back toward levels last seen before the Treasury's buyback program expansion, suggesting markets are leaning toward pricing further hikes rather than the cuts UBS needs for its short duration thesis to pay off. Oil remains the key swing factor, with Brent above 92 dollars a barrel and no resolution in sight for Strait of Hormuz disruptions. Until inflation data confirms the fading contribution from energy and tariffs that UBS is banking…

• Oil: Private survey of inventory shows a headline crude oil draw greater than expected
• Nasdaq indices close sharply lower as Iran war heats up
• All aboard!. The Bond Bears take the 10 year yield above 4.75% and up to 4.80%
• Here we go again. Trump says "Iran will be totally wiped out as a country". Crude oil trades at $90.50
• Trump confirms US striking Iran.
• Crude oil moves higher. Stocks move lower as reports of an American attack on Iran
• More Bessent: He emphasized the importance of sound formulation and communication of monetary policy
• US Treas. Sec Bessent: I think Japan is taking right steps for economy
• Canada PM Carney: We never thought we had a trade deal with US during talks
• US construction spending for July -0.5% versus 0.0% expected.
• US…

The delay strips traders and policymakers of the government's most granular read on US crude production, imports, exports and state level output for several weeks at minimum. That gap matters more than usual given how tight the supply picture already looks, with the Strategic Petroleum Reserve at a 44 year low and Strait of Hormuz shipping still disrupted by the US Iran conflict. The Weekly Petroleum Status Report keeps headline inventory and supply figures flowing, so the market is not flying blind, but the loss of the fuller monthly breakdown adds a layer of uncertainty to output estimates at a moment when precision matters. Expect analysts to lean more heavily on private surveys and weekly data until the delayed report lands.

---

Private…

Via oilprice.com:

The expected for the headline I had seen was a draw of -0.82mn bbls:

The major US stock indices are closing lower led by the NASDAQ indices and small cap Russell 2000 the worst performers.  A sampling of some of the declines shows:

• SharkNinja (SN): -9.13% at $174.92
• Credo Technology (CRDO): -8.65% at $206.63
• Cadence Design (CDNS): -7.60% at $313.04
• Whirlpool (WHR): -7.10% at $37.94
• CrowdStrike Holdings (CRWD): -6.90% at $215.07
• Dell Technologies (DELL): -6.80% at $425.00
• Strategy (MSTR): -6.03% at $124.93
• Coinbase Global (COIN): -6.00% at $176.84
• Ciena (CIEN): -5.87% at $360.33
• Synopsys (SNPS): -5.63% at $414.82
• Datadog (DDOG): -5.57% at $223.84
• Fortinet (FTNT): -5.31% at $161.85
• Palo Alto Networks (PANW): -5.25% at $362.08
• Oracle (ORCL): -5.23% at $141.32
• Shopify (SHOP): -5.12% at $139.82
• Block…

Australian GDP data is due, for the months of April, May and June. 

But, the focus today is on the RBNZ decision. A rate hike is expected, but that is not unanimous. 

Earlier:

• Preview: Westpac sees RBNZ hiking OCR to 2.75% tomorrow, data dependent from there
• Preview - Path of least resistance: ASB expects consensus RBNZ hike this week
• Reserve Bank of New Zealand Shadow Board split, most back 25bp rate hike this week
• Preview: Inflation and growth strength point to further RBNZ tightening, BNZ says
• 90% of economists expect RBNZ hike on September 2, poll shows

As mentioned, Australia's Q2 GDP lands today, and consensus has settled in the 0.2-0.4% q/q range, NAB the pessimist at 0.2%, CBA and ANZ at 0.4%, J.P. Morgan splitting the difference at 0.3%.…

As crude oil rises above $90 (the has reached $90.60) and the risks of high inflation as a result of a persistent and consistent war that will never end, has helped to push the 10 year yield higher. Today the yield has extended up to 4.80% for the 1st time since January 2025. That is also just short of the January 2025 high at 4.823%. Move above the 422 3% in the next stop is 5% for the 10 year yield.

Looking at the 4-hour chart above, the 10-year yield has broken above the 4.60%–4.75% consolidation range that had contained trading since July 21. The bond bears are taking control—and remember, higher yields mean lower bond prices.

The key now is the 4.75% level. A move back below that breakout level would disappoint the bond bears and raise…

President Trump - on a call with Fox News - said that if Iran retaliates against the most US retaliation from Irans retailiation, that they will be "totally wiped out as a country".  

He says:

• If they do respond, they'll be hit much harder
• He characterized today's hit a being very big, and if they go a third time, they're going to be totally wiped out as a country.
• He adds that an agreement with them isn't worth the paper it's writtne on.  
• We gave them a lot of chances
• The USS George Washington is loaded to the gills (with munitions).

Since an agreement is not worth the paper it's written on, it does not seem like there is no out.

The IRGC meanwhile says that the US will regret its new attacks 

A look at the markets:

• Dow -0.84%
• S&P -0.80%
• NASDAQ…

The USD is moving to a new high vs most of the major currencies helped by rising oil, higher yields from increase military tension in the middle east.  

Oil prices are nearly up $4 on the day and approaches the $90 level. Yields remain elevated with the two-year up 3.7 basis points, the 10 year up 3.4 basis points.

US president Trump said that the US is currently striking Iran targets near the Strait of Hormuz and that the strikes are larger and powerful. The attacks are in retaliation for Iranian attacks which were in retaliation for US attacks on Iran. The vicious circle continues.

In the video above I take a look at each of the major currencies vs the USD including the 

• EURUSD
• GBPUSD
• USDCHF
• USDJPY
• USDCAD
• AUDUSD and 
• NZDUSD

and talk to…