Despite US President Trump’s statement that he would hold off on launching new attacks on Iran, the stock market fell due to lingering concerns over the situation in Iran. Oil prices also dropped as a result.
The MSCI Asia-Pacific stock index dropped 0.5%, and U.S. stock futures fell 0.1%. The optimism brought by Trump’s speech has faded, replaced by concerns over the transportation of oil and gas through the crucial Strait of Hormuz. Technology stocks performed weakly, and the South Korean KOSPI index declined 4.1%.
Brent crude oil prices dropped by 2% to around $110 per barrel, having earlier fallen by 2.8%. Trump said that the strike plan against Iran had been called off at the request of allies in the Persian Gulf and added that “serious negotiations are currently underway”.
Asian early morning bond markets were mixed. Japanese and Australian government bonds rose, while US Treasuries fell after experiencing sharp fluctuations during the US trading session, amid concerns that high oil prices would exacerbate inflation. The yield on the 30-year US Treasury note rose slightly by 1 basis point to 5.13%, having climbed to its highest level since 2023 on Monday.
The moderate performance on Tuesday brought an end to the market volatility that had been triggered by the US-Iran conflict and the closure of the Strait of Hormuz over the past few weeks. Investors temporarily set aside geopolitical risks as an AI-driven stock market rally pushed up share prices. Now, with bond yields climbing in countries such as Japan and the US and oil prices remaining high, the market is facing a crucial test, which increases the likelihood that the Federal Reserve will maintain high interest rates for an extended period.
Although oil prices have dropped somewhat, they remain at a high level. Currently, the yield of US Treasury bonds largely determines the trend of the stock market. In a high-yield environment, any uncertainty in the market will prompt funds to sell stocks, and high-growth sectors may face greater pressure.
Technical analysis:
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Gold: After the overnight price returned above 4500 and stabilized after some fluctuations, it has been fluctuating around the central axis of 4550. Given that there is no reliable upward trend at present, the focus for the day remains on low-sweeping for liquidity and then catching rebounds. Today, pay close attention to the low-sweep performance in the 4500/4520 area. For detailed positions, please consult the plugin.
(Gold 15-minute chart)
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Nasdaq: Yesterday, the price tested below the 28,700 level and then rebounded. Today, we will continue to monitor the test below 28,600. If it stabilizes and rebounds after sweeping through the liquidity, we can try to catch a wave. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
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Crude oil: Both bulls and bears are clearing out liquidity, waiting for the final news to come out. We will continue to hold the position after the upward sweep and catch the pullback. For detailed positions, please consult the plugin.
(Crude Oil 15-Minute Chart)
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Today’s key financial data and events to focus on:
14:00 UK unemployment rate for March
20:30 Canadian April Consumer Price Index (Year-on-Year)
22:00 US April NAR seasonally adjusted pending home sales index
