Iran Truce 'Over' as U.S. Strikes Expand; WTI Surges 7.9%
As of 2026-07-09 00:00 SGT
Key points
- Trump declared the Iran cease-fire "over" at the NATO summit in Ankara and threatened further U.S. strikes; WTI crude rose 7.86% to $75.98 as Brent briefly topped $80
- U.S. forces struck Iranian military and port facilities at Bandar Abbas and Bushehr, killing 8 Iranian military personnel according to Iranian authorities; Iran threatened to fully close the Strait of Hormuz
- The Nikkei 225 closed -2.11% at 66,819 (third consecutive decline); European equities fell sharply (DAX -2.22%), while U.S. equity futures were off mid-session (Dow -1.55%, S&P 500 -0.95%)
- The Hang Seng closed +2.99% at 24,199, driven by Alibaba surging more than 12% on heavy southbound flows
- FOMC meeting minutes (02:00 SGT) are the overnight focal point; markets have moved to price two additional ECB rate hikes of 25bp each by year-end as the oil shock revives inflation fears
Market snapshot
| Instrument | Level | Change |
|---|---|---|
| USD/JPY | 162.66 | +0.34% |
| EUR/USD | 1.1399 | -0.09% |
| Nikkei 225 (close) | 66,819 | -2.11% |
| Hang Seng (close) | 24,199 | +2.99% |
| Dow futures | 52,371 | -1.55% |
| S&P 500 futures | 7,479.25 | -0.95% |
| Nasdaq 100 futures | 29,090 | -1.02% |
| Gold futures | 4,044.80 | -2.71% |
| WTI crude | 75.98 | +7.86% |
| Bitcoin | 61,646 | -2.64% |
| US 10-yr yield | 4.593% | +6.4bp |
Foreign exchange — Dollar firms on safe-haven demand; USD/JPY holds near 40-year highs
USD/JPY traded at 162.66, approaching the prior session's high of 162.71, as safe-haven dollar demand intensified following the renewed U.S.-Iran confrontation. EUR/USD slipped to 1.1399, near the bottom of the prior session's 1.1395–1.1434 range. Japan's 10-year government bond yield briefly touched 2.87%, the highest since May 1997, as surging oil prices stoked inflation concerns — yet widening U.S. rate-hike expectations kept the yen under pressure. The 10-year Treasury yield climbed to 4.593% (+6.4bp), and markets have begun to price in two 25bp ECB hikes by year-end, reflecting the energy shock's impact on global inflation paths. Through the rest of the NY session, USD/JPY is likely to remain elevated near the prior-day high of 162.71 ahead of the FOMC minutes; a hawkish read would reinforce further upside pressure on the pair.
Equities — Nikkei extends losses, NY sells off mid-session; Hang Seng diverges sharply
The Nikkei 225 closed 1,437 points lower at 66,819 (-2.11%) for a third consecutive decline, pressured by ongoing semiconductor sector weakness following Samsung Electronics' disappointing earnings reception and by escalating Middle East risk. European equities closed sharply lower — the DAX fell 2.22% to 24,903, STOXX 600 dropped 1.65% to 635.65. U.S. equity futures were lower mid-session (Dow futures -1.55%, S&P 500 futures -0.95%, Nasdaq 100 futures -1.02%), driven by the Iran escalation, higher oil prices, and positioning ahead of the FOMC minutes. The Hang Seng was a notable exception, closing up 702 points at 24,199 (+2.99%) on a sharp rebound in mainland tech — Alibaba surged more than 12%, lifting the broader tech sector. Through the rest of the NY session, downside pressure on U.S. futures will depend on the tone of the FOMC minutes and any further Iran-related developments.
Macro — IMF trims 2026 growth; FOMC minutes in focus
The IMF trimmed its 2026 world growth forecast to 3.0%, citing prolonged Middle East disruption and rising energy costs. The Asian Development Bank similarly cut its 2026 Asia-Pacific emerging market growth estimate to 4.9%, below the prior year's pace. Tonight's FOMC minutes (02:00 SGT) will reveal deliberations from the June 16–17 meeting — Chair Warsh's first — where the Fed held rates while adopting a hawkish tone. Analysts expect the minutes to provide clues on whether board members discussed an imminent resumption of rate hikes. Markets are now pricing two ECB hikes and two Bank of England hikes of 25bp each by year-end, as the energy shock revives global inflation fears. Into tomorrow's Asian session, the FOMC minutes are the key binary: a clearly hawkish read reinforces the dollar and raises early-session risk-off pressure.
Commodities — WTI surges 7.9% to $75.98; Brent tops $80; gold slides on dollar strength
WTI crude jumped to $75.98 (+7.86%), well above the prior session's high of $72.51, after President Trump declared the Iran cease-fire "over" and threatened additional military action. Brent crude briefly exceeded $80 per barrel during the session. Iran threatened to fully close the Strait of Hormuz and retaliate "at least twice as hard," while an Iranian parliamentary official referenced options including withdrawing from the NPT. Russia separately banned diesel exports through 31 July in response to Ukrainian drone strikes on refineries, pushing U.S. diesel futures up as much as 13% intraday. Gold futures slid to $4,044.80 (-2.71%), pulling sharply away from the prior session's high of $4,167.20, as the stronger dollar and revived rate-hike expectations outweighed the geopolitical safe-haven bid. Oil prices are likely to remain elevated through the rest of the NY session given the risk of Hormuz disruption.
Geopolitics — U.S.-Iran confrontation escalates; NATO backs Ukraine
U.S. Central Command struck multiple Iranian military and port targets including facilities at Bandar Abbas and Bushehr. Iranian authorities confirmed 8 military personnel were killed. Speaking at the NATO summit in Ankara, President Trump declared the memorandum of understanding with Iran "over" and said the U.S. would "hit them hard tonight." Iran warned it would fully close the Strait of Hormuz and retaliate at least twice as hard against any further attack, with an Iranian parliamentary official citing options including NPT withdrawal and revising its nuclear doctrine. NATO leaders issued a summit declaration reaffirming collective defense, committing €70 billion in military support to Ukraine in 2026, and reiterating that Iran "must never obtain nuclear weapons." Trump separately approved Patriot missile production within Ukraine. UK Prime Minister Starmer called for a swift return to the cease-fire and reopening of the Strait of Hormuz, warning that sustained conflict would raise living costs. The risk of Hormuz closure is the primary supply-side variable to watch through the rest of the NY session and into the Asian open.
Upcoming events
| Time (SGT) | Region | Event | Impact |
|---|---|---|---|
| 07/09 00:40 | CH | SNB Chairman Schlegel Speaks | Medium |
| 07/09 02:00 | US | FOMC Meeting Minutes | High |
| 07/09 20:30 | US | Unemployment Claims (forecast 218K) | Medium |
| 07/10 20:30 | CA | Employment Change (forecast 11.2K) | High |
| 07/10 20:30 | CA | Unemployment Rate (forecast 6.6%) | High |