07/09/2026 – Daily Reports
Global Markets: Oil, Fed Expectations and Inflation in Focus
- Strong August U.S. employment data is strengthening expectations that the Federal Reserve could maintain a tighter monetary policy stance rather than move toward rate cuts. The U.S. CPI report due later this week is expected to be the key market catalyst ahead of the Fed’s September 15-16 meeting.
- Oil prices are rising as escalating U.S.-Iran tensions increase concerns over supply disruptions around the Strait of Hormuz. Brent crude is trading near $97 per barrel, while WTI is around $92. Higher energy prices are raising concerns that renewed inflationary pressure could complicate the outlook for monetary policy.
- Asian markets are showing strong performance, particularly technology stocks. The Nikkei is up around 2.2%, while the Kospi has gained more than 3%. Strength in chipmakers and continued optimism surrounding artificial intelligence are supporting the rally.
- U.S. markets are closed today for the Labor Day holiday. Wall Street ended last week lower, while Treasury yields moved higher following the stronger-than-expected employment report. Rising oil prices and higher yields are creating additional pressure on interest-rate-sensitive technology stocks.
- European markets are also facing pressure from higher energy prices and rising inflation concerns. Investors are closely watching developments in the Middle East alongside upcoming U.S. inflation data, while expectations for further central-bank tightening remain elevated.
- Gold is under pressure as stronger U.S. employment data and higher expectations for interest rates support Treasury yields and limit demand for non-yielding assets. Gold prices are down around 0.5% in early trading.
Key market theme: Oil + U.S. inflation + Fed expectations. If oil prices remain around the $95-$100 range, renewed inflation concerns could push bond yields higher and create further pressure on the Nasdaq and other high-valuation technology stocks. On the other hand, resilient economic growth and continued demand for AI and semiconductor stocks are expected to provide support for equities and limit downside risks, particularly in the Nasdaq.
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Daily Market Highlights
- Markets are mainly focused on rising oil prices and renewed U.S.-Iran tensions. Brent crude climbed toward $97, reaching near six-week highs as attacks around the Strait of Hormuz raised concerns about global supply. Higher energy prices are also increasing inflation risks.
- U.S. equities remain under pressure from higher oil and inflation concerns, while investors are looking ahead to this week’s U.S. CPI report. A stronger inflation reading could increase expectations for a September Fed rate hike, currently priced at around 58%.
- Gold is under pressure after Friday’s strong U.S. jobs report boosted expectations for Fed tightening. The dollar and Treasury yields remain key drivers for precious metals.
- The Japanese yen strengthened to a seven-month high against the dollar as expectations for a Bank of Japan rate hike increased, with markets pricing around a 75% probability of a September hike.
Oil Nears $100 as US-Iran Attacks Escalate
- Brent crude climbs to $97.47, edging closer to the critical $100 a barrel threshold and reaching its highest level since July 24.
- WTI rises to $92.26, remaining near a six-week high after gaining nearly 10% last week.
- Oil prices are being driven higher by escalating U.S.-Iran attacks on commercial shipping, raising fears of a major disruption to Middle East oil flows.
- U.S. forces struck three Iranian oil tankers on Saturday, including one near Kharg Island, a key Iranian oil-export hub.
- Iran’s IRGC said it retaliated by targeting six vessels, including three oil tankers using what it described as unauthorized routes through the Strait of Hormuz.
- Hormuz traffic has fallen sharply: an average of just 10 commodity ships per day crossed the strait over the past 10 days — the lowest level since May.
- The attacks are increasingly blurring the line between military conflict and commercial shipping, according to maritime intelligence firm Marisks.
- Saudi Arabia’s Jazan oil refinery was reportedly attacked, adding another layer of risk to regional energy infrastructure.
- Goldman Sachs warns that oil could surge as high as $120 a barrel if attacks on shipping intensify.
- Iran is also preparing to announce a restricted zone outside the Strait of Hormuz, potentially increasing pressure on already-limited tanker traffic.
- Meanwhile, OPEC+ kept its October oil output policy unchanged, leaving the market without an immediate additional supply cushion.
