A wave of optimism seems to be awaiting Wall Street on Tuesday as Dow Futures witnessed a healthy rally, energised by Israel’s acceptance of President Donald Trump’s ceasefire offer.
Dow Jones Futures shot up an impressive 400 points, with the S&P 500 and Nasdaq following suit, gaining 58 and 275 points respectively.
This market rally comes despite reports of ceasefire violations from Israel and Iran.
US President Donald Trump expressed his displeasure with the ceasefire violations.
“ISRAEL. DO NOT DROP THOSE BOMBS,” Trump said on his Truth Social platform. “IF YOU DO IT IS A MAJOR VIOLATION. BRING YOUR PILOTS HOME, NOW!”
Oil prices saw sharp reversals
Unsurprisingly, the biggest shift from this geopolitical development has been in the oil markets.
Brent crude took a nosedive, plummeting over 8% last night and shedding another 5% this morning, pushing prices back below the $70 per barrel mark after briefly touching $81 overnight.
Gold prices and the US Dollar index also saw declines, as investors moved away from traditional safe-haven assets.
Back to business?
With the hope that immediate Middle East tensions will diffuse soon, the market’s attention is now firmly redirecting toward economic matters.
US President Donald Trump’s tariff agenda may take the spotlight again as his July 9 deadline still looms.
The investors will closely track the Federal Reserve Chair Jerome Powell’s two-day Congressional testimony, set to begin tonight.
His insights into the economy will undoubtedly shape market sentiment in the days to come.
Donald Trump didn’t miss the chance to question why the US Fed is not considering cutting benchmark interest rates when other countries have made substantial cuts in the past few months.
“Too Late” Jerome Powell, of the Fed, will be in Congress today in order to explain, among other things, why he is refusing to lower the Rate. Europe has had 10 cuts, we have had ZERO,” the US President said on Truth Social.
Donald Trump added that the US should be at least two to three points lower and it would have saved “800 Billion Dollars Per Year, plus”.
“If things later change to the negative, increase the Rate. I hope Congress really works this very dumb, hardheaded person, over. We will be paying for his incompetence for many years to come. THE BOARD SHOULD ACTIVATE. MAKE AMERICA GREAT AGAIN!,” the leader of the free world added.
Asian markets close high Trump’s ceasefire call
Donald Trump’s ceasefire announcement eased the nerves of investors in Asia as most of the benchmark indexes traded in green on Tuesday.
South Korea’s Kospi 100 index is maintaining its lead and is trading near its all-time high levels.
Japan’s Nikkei 225 and Hong Kong’s Hang Seng index also witnessed sharp gains today.
Indian indices opened higher on Tuesday after the ceasefire announcement, but as Israel and Iran continued the strikes, Sensex saw reversals and ended only 0.19% up from its previous close.
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