📅 Monday, June 16
► European markets rebound as investors shrug off conflict, eye energy resilience & hope for US-EU trade deal
European equities rose as fears of a broader Middle East escalation eased and energy markets stabilized. The Stoxx 600 climbed +0,4%, with strong gains in the FTSE MIB (+1%), IBEX (+1.1%), and CAC 40 (+0.9%). DAX (+0.45%) and FTSE 100 (+0.50%) also advanced but moderately, while the Swiss SMI (-0.20%) lagged. The UK 10Y yield moved up to 4.57%, and Germany’s Bund held firm at 2.56%. The euro strengthened to above 1.157 against the US dollar. Energy (despite lower oil prices) and defense stocks saw continued inflows, while travel and tech rebounded. The EU and the US apparently move closer to a trade deal with the European Union potentially agreeing to a flat 10% tariff by the US in a bid to avoid higher tariffs on drugs, electronics, and cars.
► US futures rebound as oil declines & hopes for contained conflict return
US stock futures are trading higher in pre-market trading (S&P +0.6%, Nasdaq +0.7%, Dow +0.5%) as oil prices cooled and investors priced in a limited extent of tensions between Israel and Iran. Friday's sharp decline led to renewed buying, especially in tech stocks, with chip/AI stocks and Tesla leading the gains. 10-Y Treasury yields rose or remained steady at 4.43% as some investors fear that higher energy prices will bring back inflation. European markets also benefited from strong Chinese retail sales. The market expects the Fed to keep interest rates unchanged this week despite pressure from President Trump to cut rates, which is a risk for a renewed deterioration in risk sentiment. SmartTrader chief analyst Robert Lindner also sees excessive valuations as a weakness on Wall Street, especially if energy prices rise again.
► Asian equities rebound as traders digest conflict impact & strong China retail data
Asia-Pacific indices closed broadly higher as investors balanced rising geopolitical tensions with strong Chinese consumption data. Japan’s Nikkei surged +1.26%, Korea’s Kospi jumped +1.8%, and Hong Kong’s Hang Seng gained +0.7%. Mainland China indexes were also up (Shanghai +0.35%, Shenzhen +0.41%), while India’s Nifty 50 rose +0.92%. Australian markets traded flat and Singapore’s STI slipped slightly (-0.08%). China’s retail sales grew 6.4% y/y in May, lifting sentiment. Traders are now watching for signs of escalation from Iran or oil supply disruptions.
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