WS #9386

The dominant narrative remains the US-Iran conflict and its impact on oil markets, but this window shows a clear de-escalation signal. The US Embassy in Jerusalem lifted its shelter-in-place order for government employees, and multiple sources report that oil declined after Israel and Iran agreed to stop attacking each other following a flare-up in violence. Bloomberg reports stocks joined bonds higher as oil fell below $90 amid hopes the US and Iran are getting closer to a deal. This corroborates the earlier ceasefire narrative and is the most significant market-moving development. However, this de-escalation is countered by an Israeli strike on southern Lebanon that killed at least eight people, threatening the uneasy pause. On the corporate front, Broadcom reported strong Q2 results with revenue up 48% YoY, and GSK agreed to buy Nuvalent for $10.6 billion. The macro narrative is shifting from crisis escalation to potential resolution, with oil prices and risk assets reacting accordingly.