Morning Brief: Easing geopolitics lifts risk‑assets; Dow and S&P 500 hit fresh all‑time highs

Core Snapshot

🕊️ Expectations build for the reopening of the Strait of Hormuz. Crude oil plunges more than 5%, WTI falls below $76 and Brent slips under $80 per barrel.

📊 Strengthened AI‑capital‑return logic plus solid earnings from tech giants drive markets higher. S&P 500 rises 1.79% to 7736.52 and Dow Jones gains 1.71% to 54085.88, both printing new all‑time closing highs.

I. Market Outlook

Key Events:

‑ Rising hopes for Strait of Hormuz reopening trigger oil slump. Qatar and the US send successive diplomatic signals. Iran reports “positive progress” in talks with Oman and is reportedly considering allowing European mine‑clearing operations for the first time.

→ WTI crude drops 5.69% to $75.77/bbl; Brent crude falls 5.26% to $79.36/bbl.

Exclusive Insight:

Crude has tumbled over 10% across two sessions, with Brent breaking below $80. Geopolitical risk premiums built up since the Hormuz crisis are unwinding rapidly. SpaceX’s 92% revenue jump together with sustained AWS growth validate that AI‑infrastructure spending is translating into top‑line revenue. Still, AMD’s 8% after‑hours drop shows markets have set extremely high bars for AI earnings: beating consensus is no longer enough; results need to beat estimates by a wide margin.

II. Overnight Market Action

— US Stocks: S&P 500 +1.79% at 7736.52, surpassing the June‑2 closing record. Dow Jones +1.71% at 54085.88, notching all‑time highs for two straight days. Nasdaq +2.59% at 26584.99.

— European Stocks: STOXX Europe 600 +0.73% at 656.86.

— Bond Market: 10‑year US Treasury yield down 5.08 bps to 4.6248%. 2‑year yield down 4.15 bps to 4.1959%.

— Commodities: September WTI crude ‑5.69% at $75.77/bbl. Brent crude ‑5.26% at $79.36/bbl. Spot Gold +0.57% at $4077.78/oz. Silver +2.35% at $59.5423/oz.

— FX Market: US Dollar Index ‑0.04% at 99.858.

— Crypto Assets: Bitcoin breaks above $64,000. Ethereum trades at $1870.19.

III. Macro News

1. 🕊️ Reopening hopes for Strait of Hormuz send oil sharply lower

Qatar and the US issue successive diplomatic signals. Iran cites “positive progress” in Oman‑mediated talks and is reported open to European mine‑clearing for the first time. Markets price in higher odds of resuming normal shipping through the strait.

Insight: Oil has lost more than 10% over two days and Brent trades under $80 as geopolitical premiums unwind fast. While markets are pricing for resumed shipping, substantial uncertainty remains over tangible negotiation outcomes.

2. 📊 US June JOLTS Job Openings fall more than expected with limited lay‑offs

Openings drop to a three‑month low, lay‑offs stay subdued while hiring picks up. The labour market is cooling moderately rather than deteriorating.

Insight: Moderate cooling represents the desired path for the Fed — it avoids fanning inflation without stoking recession fears. Pressure on Wash at the September policy meeting eases somewhat.

3. 🇯🇵 Weak demand at Japan’s 10‑year JGB auction

The auction posted the second‑largest price decline this century, with the tail falling to 2.56, the lowest since May 2025. The result signals market frustration over the BoJ’s policy stance.

Insight: Even after US‑Japan coordinated intervention lifted the yen to three‑month highs, domestic bond markets are pushing for a clearer roadmap toward monetary‑policy normalisation.

4. 🛢️ OPEC July output rises 1.16 mb‑m‑m to 19.44 million barrels per day

Kuwait, Saudi Arabia and Iraq account for nearly all incremental supply. Total output remains well below pre‑conflict levels amid ongoing disruptions in Iran.

Insight: OPEC supply increases are materialising. Combined with Hormuz‑reopening expectations, dual bearish supply‑side forces weigh on crude prices.

IV. Global Corporate News

1. 🚀 SpaceX releases first post‑IPO earnings: revenue surges 92%, Starlink drives profits

Revenue jumped 92%. Starlink acts as the main profit engine. Losses on AI‑related businesses narrow though spending runs above forecasts. Management flags potential for hitting trillion‑dollar revenue earlier than planned, with Nvidia as key chip supplier. V3 satellite deployments will scale an order‑of‑magnitude above V2. As a landmark IPO case from Q2, its strong print improves sentiment across the IPO market.

2. 💾 AMD Q2 revenue and profit beat consensus but Q3 guidance misses aggressive market expectations; stock drops as much as 8% after hours

On the earnings call AMD stressed “we are still in the early phase of the AI cycle” and forecasts data‑centre sales will double by 2027. Markets have set very high hurdles for AI‑linked results: merely beating estimates is insufficient to support share prices; wide upside surprises are required.

3. 💾 Samsung retakes global No.1 position in DRAM for Q2‑2026 with 39% market share

It overtakes SK Hynix. The shift in DRAM leadership reflects ongoing capacity‑allocation trade‑offs between HBM and conventional DRAM products.

V. Key Events to Watch

📊 July Services & Composite PMI for US, Eurozone, UK, Japan: read‑out for real global momentum after easing geopolitical risks.

📊 US July ADP Employment Change: key labour‑market preview ahead of non‑farm payrolls.

📊 Eurozone June PPI: check for clear producer‑price disinflation following sharp oil‑price falls.

📊 Bank of Japan June Monetary Policy Meeting Minutes: clues over policy divisions amid FX intervention and bond‑market discontent.