📰 Red Sea Flare-Up! Trump To Decide Iran Strike, Oil Eases While US Stocks Rally

1 Key Snapshot

· ⚠️ Cross-border clashes resume between Saudi Arabia and Houthi forces. Yemeni civilians flee conflict by boat across the Red Sea. Trump says he will soon make a major call on whether to resume large-scale strikes against Iran.

· 📈 US Initial Jobless Claims unexpectedly fell by 10,000 to 196,000, the lowest reading since mid-July. US equities closed higher, Nasdaq led gains with a 1.69% jump.

2 Market Outlook

Key Events

- Renewed clashes between Saudi and Houthi, Trump set for major Iran decision: Cross-border attacks resume, stoking Red Sea tensions. Trump stated he will decide shortly whether to restart large-scale military strikes on Iran. → WTI -0.51% at $101.91/bbl; Brent -0.95% at $104.82/bbl. Geopolitical premium was capped by demand concerns.

- US Initial Jobless Claims drop to 196,000, the lowest since mid-July, reflecting resilient labour market. → Dow +0.62% at 51779.85; S&P500 +1.14% at 7637.74; Nasdaq +1.69% at 26418.30.

Exclusive View

The drop in jobless claims reinforces solid employment fundamentals, supporting further Fed rate hikes. Still, US equities rallied after the rate hike. Markets may view the start of tightening cycle as removal of major uncertainty.

3 Overnight Market Action

US Equities

Dow +0.62% at 51779.85; S&P500 +1.14% at 7637.74; Nasdaq +1.69% at 26418.30.

European Equities

STOXX 600 +0.9% at 642.6. FTSE100 +1.2%, best single-day gain in over two months; DAX +0.7%; CAC40 +0.57%.

Bond Market

10Y US Treasury yield fell below 5%, down 6.1 bps to 4.943% at close. 30Y yield -5.6 bps to 5.292%.

Commodities

WTI Oct -0.51% at $101.91/bbl; Brent -0.95% at $104.82/bbl. COMEX Gold +0.32% at $4360.2/oz; Silver +1.84% at $65.47/oz.

FX

US Dollar Index flat at 100.23; EUR +0.1% to 1.1474; GBP -0.2% to 1.3355; JPY +0.2% to 155.96.

Crypto

Bitcoin +1% above $76509; Ethereum +2.4% to $2450.

4 Macro News

1. ⚠️ Saudi-Houthi clashes resume, Trump to make major Iran-related decision. Cross-border attacks escalate, refugees flee the Red Sea zone. Trump will decide soon on large-scale military action against Iran.

Insight: Trump’s military decision is the biggest geopolitical variable. A strike would lift oil prices; negotiation talks would erase part of geopolitical risk premium.

2. 🏛️ BoE keeps rates unchanged but warns Iran conflict may force hikes. BOJ expected to lift rates to 31-year high. Energy shocks push global central banks toward tighter policy.

3. 📊 US Initial Jobless Claims fell to 196,000. Strong job data backs the Fed’s hawkish stance.

4. 🛢️ JPMorgan: Oil outlook remains uncertain. Weak demand offsets supply shocks. Oil direction hinges on shipping safety in Strait of Hormuz.

5 Global Corporate News

1. 💾 Jensen Huang: Nvidia chip sales will double next year; AI cannot be regulated like social media. Nvidia stays highly optimistic on AI demand.

2. 🚀 SpaceX reportedly looks to buy data from defunct startups to expand training data for Grok AI. A forecast estimates Starship may generate $10 trillion revenue, Musk replied “not impossible”.

6 Today’s Focus

· 📊 Japan August CPI: High oil prices keep import-driven inflation pressure elevated.

· 🏛️ BOJ rate decision + Ueda press conference. Market prices a rate hike to 31-year high, watch guidance on future hikes.

· 📱 iPhone 18 Pro launches Sep 18, first flagship under Apple’s new CEO. Investors track sales performance.