WTI drops to $72; chip surge cushions US-Iran risk
As of 2026-07-10 00:00 SGT
Key points
- The US and Iran exchanged fresh strikes on 9 July: US forces struck near Iran's Bushehr nuclear plant and port infrastructure; Iran's Revolutionary Guard Corps fired 10 ballistic missiles at US military command centres and an air base in Jordan, and deployed drones against US bases in Bahrain, Kuwait and Qatar. President Trump declared the interim ceasefire "over" at the NATO summit in Ankara
- Hormuz tanker traffic all but halted, yet WTI crude fell to $71.97 (-2.1%) from a $76.08 session high as markets concluded that Iranian retaliation is not targeting Gulf energy infrastructure
- Micron Technology raised its US factory investment plan to $250 billion, lifting the Philadelphia Semiconductor Index 4.6%; SK Hynix's US ADR priced at $149 per share with demand exceeding 7x the offering size
- Nikkei 225 closed at 67,744 (+1.38%), snapping a three-session losing streak; European equities rose (DAX +0.96% to 25,104, STOXX 600 +0.83% to 641.20)
- NY Fed President Williams said inflation risk remains "more on the upside," specifically flagging AI-driven demand as a potential trigger for additional tightening
Market snapshot
| Instrument | Level | Change |
|---|---|---|
| USD/JPY | 162.28 | -0.17% |
| EUR/USD | 1.1442 | +0.18% |
| Nikkei 225 (close) | 67,744 | +1.38% |
| Hang Seng (close) | 24,030 | -0.70% |
| Dow futures | 52,810 | +0.35% |
| S&P 500 futures | 7,576.25 | +0.63% |
| Nasdaq 100 futures | 29,898 | +1.46% |
| Gold futures | 4,139.30 | +1.39% |
| WTI crude | 71.97 | -2.11% |
| Bitcoin | 62,834 | +0.97% |
| US 10-yr yield | 4.547% | -2.2bp |
Foreign exchange — yen firms modestly as JGB yields hit 29-year high
USD/JPY eased to 162.28 (-0.2%), contained within the previous session's 162.24–162.61 range. Japan's 10-yr JGB yield climbed to 2.9%, the highest since November 1996, providing marginal yen support by narrowing the US-Japan rate differential at the long end. EUR/USD edged up to 1.1442 (+0.2%), underpinned by the ECB's June meeting accounts confirming that inflation is "more persistent than expected" — drawing explicit comparisons to the 2011 policy misstep that policymakers said they aimed to avoid by remaining data-dependent and meeting-by-meeting. The dollar is finding support from Williams's hawkish tone, keeping yen recovery in check. Through the rest of the NY session, USD/JPY is likely to hold the mid-162 range, with a sustained push through 163 requiring fresh geopolitical escalation.
Equities — semiconductor surge overrides geopolitical noise
The Nikkei 225 closed at 67,744 (+1.38%) on 9 July, driven by semiconductor-linked names. Micron Technology jumped ~7% in the US session after announcing it would raise its US factory investment to $250 billion, lifting the Philadelphia Semiconductor Index 4.6%. Nasdaq 100 futures hold at 29,898 (+1.5%) while S&P 500 futures stand at 7,576.25 (+0.6%). European equities closed firmly: DAX +0.96% to 25,104, STOXX 600 +0.83% to 641.20. The Hang Seng fell to 24,030 (-0.7%), weighed by China's weaker June CPI and a near four-year high in producer inflation that raised doubts about domestic recovery momentum. SK Hynix's US ADR was priced at $149, drawing more than 7x oversubscription, further validating the AI memory chip investment theme. Going into the second half of the NY session, semiconductor momentum is the dominant market force, reducing the effective drag from geopolitical risk premiums.
Macro — JGB yields at 29-year highs; Fed's Williams flags AI-driven inflation risk
Japan's 10-yr JGB yield reached 2.9%, the highest since November 1996, with 30-yr JGB yields exceeding 4%. The Japanese government is set to include explicit language affirming BOJ independence in its annual Honebuto fiscal framework, reinforcing expectations that the Bank of Japan will continue its policy normalisation. NY Fed President Williams stated that risks remain "more on the inflation side," warning that sustained AI-driven demand could require additional tightening if inflation proves stickier than the baseline. June US existing home sales printed at 4.09 million annualised, below the 4.20 million consensus, confirming that high rates continue to weigh on housing demand. The US 10-yr yield ticked down 2.2bp to 4.547% but remains elevated. The interplay between rising global long-end yields and AI-capex-driven demand will be a key macro theme through the NY close and into Asian trading.
Commodities — crude reverses despite Hormuz shutdown; gold rebounds above $4,100
WTI crude fell to $71.97 (-2.1%), dropping sharply from a 9 July high of $76.08 as participants concluded that Iranian retaliation is targeting US military assets rather than Gulf energy infrastructure, limiting the supply-disruption premium. Hormuz tanker traffic has effectively halted, and Tehran reportedly loaded roughly 11 million barrels of crude onto tankers over the past 24 hours ahead of expected sanctions tightening, though buyer availability remains uncertain. European natural gas (TTF) firmed 1.2% to €50/MWh following Qatar's decision to suspend its LNG production restart plan. Gold futures recovered to $4,139.30 (+1.4%), bouncing after a three-session decline to reclaim the $4,100 level.
Geopolitics — US-Iran ceasefire in name only; Hormuz all but closed
US Central Command launched a new wave of strikes on 9 July against Iranian targets including sites near the Bushehr nuclear plant, coastal facilities and port infrastructure. Iran's IRGC fired 10 ballistic missiles at US command-and-control centres and an air base in Jordan and deployed drones against US military installations in Bahrain, Kuwait and Qatar. President Trump, speaking in Ankara at the NATO summit, declared the interim ceasefire "over" and claimed US military superiority. Israeli Defence Minister Katz stated Israel is prepared to resume strikes on Iran "if the threat returns." The Gulf Cooperation Council demanded Iran comply fully with its memorandum of understanding with the US. UK maritime authorities maintained a "Severe" threat rating for the Middle East. Iran's foreign minister condemned the strikes as violations of the UN Charter and the US-Iran memorandum; Iran's president and foreign minister were separately reported to have been physically attacked by hard-line factions opposed to any deal with the US, deepening Tehran's internal divisions.
Upcoming events
| Time (SGT) | Region | Event | Key watch |
|---|---|---|---|
| 07/10 20:30 | CA | Employment Change (forecast 11.2K) | Canadian labour market strength; CAD direction and BoC easing odds |
| 07/10 20:30 | CA | Unemployment Rate (forecast 6.6%) | Deviation from forecast could shift Bank of Canada rate-cut expectations |