Oil at six-month highs, Iran tensions weigh on stock markets

Oil has returned to its highest levels in the past six months, bringing geopolitics back to the center of financial markets. Brent crude rose 0.7% to $72.19 per barrel, pushing its weekly gain above 6%, after U.S. President Donald Trump granted Iran a 15-day ultimatum to reach an agreement on its nuclear program, pairing diplomatic pressure with a broad deployment of military forces in the Middle East.

Washington’s move — which includes aircraft carriers, fighter jets and refueling tankers — has heightened fears of escalation in a region that accounts for roughly one-third of global crude production. The risk of supply disruptions has supported energy prices and boosted demand for safe-haven assets.

After Thursday’s selloff on Wall Street, U.S. and European futures attempted a rebound (+0.3% and +0.4% respectively), while losses in Asia narrowed over the course of the session. South Korea stood out, with its local index rising 2.3%, confirming its position among the year’s best-performing markets. However, investors remain cautious, aware that the standoff between the United States and Iran could deteriorate.

Treasuries consolidated their gains, supported by safe-haven demand, while gold remained at elevated levels and silver posted a slight advance. In currency markets, the dollar is heading for its best week in the past four months: the Bloomberg Dollar Spot Index rose 0.9%, driven by downward revisions to expectations for Federal Reserve rate cuts and intensifying geopolitical risks.

Investors are now watching upcoming U.S. macroeconomic data and forthcoming Supreme Court decisions on tariffs, in a context where inflation and international tensions risk slowing a still-fragile market recovery.

Corporate highlights

On the corporate front, Johnson & Johnson is reportedly preparing a potential sale of its orthopedics unit, which it had previously planned to spin off. According to people familiar with the matter, several major private equity firms have already expressed interest, suggesting the deal could attract significant bids in a segment considered strategic within the medical sector. In the entertainment industry, Ted Sarandos, co-chief executive officer of Netflix Inc., said that his company’s acquisition of Warner Bros. Discovery Inc. would result in a greater number of films being released in movie theaters. His remarks respond to one of Hollywood’s main criticisms in the high-stakes battle for one of the industry’s most iconic studios, aiming to reassure the industry about the future of traditional distribution. In Asia, the spotlight is on Mirae Asset Securities Co., whose shares have more than tripled in value since the beginning of the year. The rally is seen as an indirect bet on Elon Musk and his SpaceX, ahead of a potential blockbuster initial public offering that could attract fresh capital inflows.

Key financial market developments

As for financial markets, U.S. futures are trading in positive territory: contracts on the S&P 500 and the Nasdaq 100 are both up 0.3% in early London trading, signaling a constructive start on Wall Street. In Asia, however, caution prevails: the MSCI Asia Pacific Index is down 0.3%, while Hong Kong’s Hang Seng falls 0.7%. In Europe, Euro Stoxx 50 futures rise 0.4%, pointing to a higher opening for the continent’s major indices.

In currency markets, the Bloomberg Dollar Spot Index remains broadly unchanged. The euro loses 0.2% to $1.1752, while the Japanese yen slips 0.1% to 155.22 per dollar. The offshore yuan holds steady at 6.9006 per dollar, and the British pound also declines 0.2% to $1.3442.

Cryptocurrencies are broadly firmer: Bitcoin advances 1.4% to $67,813.1, while Ether gains 0.5% to $1,957.46, amid renewed interest in digital assets.

In bond markets, the yield on 10-year U.S. Treasuries remains steady at 4.07%. In Japan, the 10-year yield falls 3.5 basis points to 2.105%, while in Australia the 10-year rate drops six basis points to 4.73%, signaling moderate demand for government bonds.

Finally, among commodities, spot gold rises 0.7% to $5,029.92 per ounce, while West Texas Intermediate gains 0.9% to $67.05 per barrel, in a context of slightly recovering energy prices.

Andrea Pelucchi