Markets shrug off US strike on Iran
Stocks recover from overnight wobble
The great ‘US attacks Iran selloff’ of 2025 lasted for about six hours before futures stabilised and oil prices gave up their weekend gains. The absence of any Iranian counterstrike to the attack on its nuclear facilities has given investors some hope that the conflict will remain limited. US authorities however continue to warn of a possible response, which puts today’s stabilisation in markets in jeopardy. Arguably only the closure of the Hormuz straits would provide a real shock, but given Iran’s role in supplying China with energy it seems to make sense for Iran to talk up the possibility of closure without actually going through with it.
Dollar’s bounce falters
Safe-haven flows lifted the greenback for a brief while but without any further developments in Iran the ‘sell the dollar’ trade is back in action. The move was given further impetus by another Fed governor breaking cover to call for a rate cut. This dovish caucus should grow louder so long as inflation remains muted.
Author
