OVERVIEW
Markets on July 21, 2026 were dominated by escalating Middle East geopolitical tensions, particularly the US-Iran conflict, combined with earnings season from US tech giants.GEOPOLITICS: US-IRAN CONFLICT ESCALATES
- President Trump vowed Iran will "pay a price" for killing three US soldiers.
- Iran-backed Houthi forces declared a naval blockade against Saudi Arabia, threatening energy shipments through the Red Sea and Bab-el-Mandeb Strait.
- Mediators have proposed a 10-day ceasefire with Iran, offering fragile hope for peace.
CRUDE OIL: VOLATILE NEAR 6-WEEK HIGHS
- Brent: Hit a mid-June high of $91.42/bbl**, then retreated to **$88.88.
- WTI: Traded around $83/bbl.
- Supply threats from potential Hormuz disruption and Red Sea blockade could impact Saudi exports.
FOREX: DOLLAR FIRM, COMMODITY CURRENCIES SUPPORTED
- DXY: Steady at 100.96, near weekly highs.
- USD/JPY: Flat around 162.50.
- EUR/USD: Traded near $1.1415.
- GBP/USD: Rose to $1.3434 on UK PM Andy Burnham's fiscal commitment.
- AUD/USD: Edged higher to $0.7001.
- NZD/USD: Rose 0.4% to $0.5860 on inflation data support.
BONDS: YIELDS RISE ON INFLATION FEARS
- US Treasuries: 10-year yield at 4.5937%, 30-year above 5%.
- UK Gilts: Prices fell on concerns over the new PM's fiscal policy.
STOCKS: AWAITING TECH EARNINGS
- US: Dow Jones declined. Hedge funds dumped US tech stocks at record pace over past 2 months.
- Asia: Nikkei 225 rose over 1%, KOSPI gained nearly 3% on ceasefire hopes.
- Upcoming: Tesla and Alphabet report on Wednesday.
KEY EVENTS THIS WEEK
- US Tech Earnings: Tesla & Alphabet (Wed), Microsoft, Meta, Apple, Amazon (next week).
- US-Canada Tariffs: Trump imposes 50% tariff on some Canadian goods.
- ECB Rate Decision: Expected to hold rates, but September hike bets are rising.
