There’s a lot of back and forth going on but ultimately, the bottom line is that the US and Iran have not yet agreed to a memorandum of understanding. The “deal to end the conflict” was supposed to be “imminent” since the weekend. But fast forward now to Thursday, and we’re yet to see any official word on how things are playing out.
That is keeping markets on edge today with the situation not helped by conflicting headlines and also increased tensions on the ground. The US have launched another strike at Iran overnight, with this being the second attack in the past three days. The situation is tense and volatile, resulting in more caution as we get into the new day.
Besides that, Iran also continues to maintain that they won’t move on their red lines here. That is something that puts a dent on the recent optimism and may allude to the notion that an agreement may not be as “imminent” as it seems. As mentioned yesterday, both the US and Iran know what puzzle pieces are needed to complete the picture. The only question now is how are they going to fit all of that together and make it stick?
So far today, oil prices are nudging up with WTI crude higher by nearly 4% to be above $92 currently. Meanwhile, US futures have dropped off after the more cautious showing yesterday in Wall Street. S&P 500 futures are now down 0.4% with Nasdaq futures down 0.8% currently.
In other markets, bond yields are creeping back up again with 10-year Treasury yields higher by 4 bps to 4.52%. And looking to precious metals, we are seeing gold drop heavily again today – down nearly 2% to $4,373, its lowest in two months and contesting a break of its 200-day moving average. The key technical level is one that may lead to a steeper decline in the precious metal as outlined here.
