On Tuesday, the U.S.-Iran conflict and the blockade of the Strait of Hormuz remained the key variables affecting global markets.Trump stated that no negotiations with Iran are currently underway and that the naval blockade remains fully in effect; Iranian Parliament Speaker Kalibaf said the Strait of Hormuz will remain closed until Washington meets Iran’s conditions; and the United Arab Emirates announced a suspension of trade, commercial, and financial transactions with Iran.
The U.S. Dollar Index continued its nearly two-week-long consolidation above 99, ultimately closing up 0.01% at 99.65; the benchmark 10-year U.S. Treasury yield closed at 4.708%, while the 2-year U.S. Treasury yield—which is sensitive to the Fed’s policy rate—closed at 4.181%.
Spot gold fluctuated lower throughout the day, accelerating its decline after Trump declared that “the Strait of Hormuz is open and operating normally,” and ultimately closed down 1.86% at $4,334.57 per ounce;Spot silver ultimately closed down 3.72% at $63.34 per ounce.
The UK Maritime Authority received reports of vessels in the Strait of Hormuz being struck by projectiles; concerns over supply disruptions and shipping risks continued to dominate the market, and international oil prices extended their gains.WTI crude oil closed up 0.3% at $84.34 per barrel; Brent crude oil closed up 0.26% at $91.32 per barrel.
In U.S. stock markets, the Dow Jones Industrial Average closed down 0.2%, the S&P 500 fell 0.69%, and the Nasdaq dropped 1.33%. SanDisk (SNDK.O) fell 9%, Western Digital (WDC.O) fell 7%, and Micron Technology (MU.O) fell 7%.SK Hynix (SKHY.O) fell more than 9%, and Nvidia (NVDA.O) fell 2%. The Nasdaq Golden Dragon China Index closed down 1%, while Alibaba (BABA.N) rose 2.8%.