πŸ“Š Market Overview

  • πŸ₯‡ Spot Gold: $4,342.23/oz, +0.03% on the day (peaked at $4,352 overnight then pulled back)
  • πŸ›’οΈ WTI Crude: $78.03/bbl, +2.2% on the day (driven by Hormuz tensions)
  • πŸ›’οΈ Brent Crude: $83.5/bbl, +2.4%
  • πŸ“ˆ US Stock Futures: Nasdaq +0.16%, Dow -0.14% (mixed)
  • πŸ’± Dollar Index: -0.04%; USD/JPY -0.08%; EUR/USD +0.03%
  • πŸ‡―πŸ‡΅ Japan June Current Account: -Β₯923B (expected +Β₯15,120B, significant miss)

πŸ”₯ Key Overnight News

  1. Hormuz Strait deal still unreached β€” Iran and Oman failed to reach an agreement on reopening the strait over the weekend. Houthi forces claimed attacks on Saudi Aramco refineries. US CENTCOM has redirected 55 commercial vessels. Oil prices jumped over 2%.

  2. Trump shifts Iran strategy to “low-key” approach β€” Moving from military threats to a “patience” playbook. Iran is demanding sanctions relief, troop withdrawal, and reparations, raising the bar for negotiations. Iran simultaneously replaced its top security official Zolqadr, with Rezaei taking over as Secretary of the Supreme National Security Council.

  3. Fed September hike expectations rise β€” CME FedWatch shows 44.4% probability of a 25bp hike in September, 59.2% for October.

  4. Russia-Ukraine conflict escalates β€” Russia’s Defense Ministry claims interception of 285 Ukrainian drones and strikes on Ukrainian port fuel facilities. Ukraine reports Russian attacks on Odesa causing power outages in some areas.

  5. Gaza situation remains volatile β€” Netanyahu reportedly agreed to withdraw from three areas in southern Gaza but reversed course the same day. The White House stated it “doesn’t care” about his statements, viewing them as electoral politics. Israel emergency diverted Β₯1B from Intel project funds to defense budget.

  6. Musk may challenge EUV lithography β€” SpaceX and Tesla partnering on a $16.8B investment in Terafab chip facility, potentially using FEL technology as an alternative to EUV lithography machines.

  7. Hedge funds accelerate yen short covering β€” CFTC data shows leveraged funds reduced yen net short positions by 74,440 contracts over 5 weeks, the largest reduction since 2008.

  8. China July CPI +0.5% YoY β€” Consumer prices rose modestly.

🧭 Situation Assessment

The Hormuz Strait impasse is the core variable for global risk assets currently; oil’s 2%+ jump reflects still-incomplete market pricing of energy transit disruption risk.

Trump’s shift from military threats to a “low-key” Iran approach reduces the probability of direct military conflict in the short term, but Iran’s elevated negotiation conditions mean the deal could remain in flux.

Fed September hike probability rising to 44.4%, combined with Japan’s unexpected current account deficit and accelerating yen short covering, suggests USD/JPY may continue to face downward pressure.

The scale of Russia-Ukraine drone warfare is expanding, with Ukraine escalating strikes on Russian territory β€” watch for potential Russian retaliatory escalation.

Middle East dynamics remain fragmented β€” Houthi attacks on Saudi facilities, Israel diverting Intel funds to defense, Lebanon-Israel talks postponed β€” the geopolitical risk premium is unlikely to fade in the near term.

This week’s key focus: US CPI data and Tencent earnings, which will provide critical direction for US and HK equities.

πŸ“… Today’s Key Data Calendar

  • 07:50 ⭐⭐ Japan June Trade Balance / Current Account (Released: Current Account -Β₯923B, significant miss)
  • 07:50 ⭐⭐ BOJ July Policy Meeting Opinion Summary
  • 16:30 ⭐⭐⭐ Eurozone August Sentix Investor Confidence (expected -0.5)
  • 22:00 ⭐⭐ US July Conference Board Employment Trends Index
  • 23:30 ⭐ US 3-month / 6-month T-bill auctions

πŸ“… This Week’s Key Events

  • Monday: BOJ opinion summary, Eurozone Sentix
  • Tuesday: RBA rate decision (expected 4.35% unchanged), US NFIB Small Business Optimism, US Existing Home Sales
  • This Week: US CPI, refined oil price adjustment, Tencent earnings