09/04/2026 Daily Reports
U.S. stock futures edged lower on Thursday as oil prices rebounded and uncertainty around the fragile ceasefire between Washington and Iran weighed on sentiment. Reports suggesting disruptions to tanker traffic through the Strait of Hormuz, alongside renewed regional strikes, have reignited concerns over energy supply and geopolitical stability. While there are tentative signals that diplomatic talks may continue, conflicting developments are keeping investors cautious.
The pullback follows a strong rally in the previous session, where major indices surged on optimism surrounding a temporary ceasefire agreement. Gains across sectors reflected a broad risk-on move, supported by hopes of de-escalation. However, with questions emerging over the durability of the truce, markets remain highly sensitive to headlines. In the near term, price action is likely to be driven by developments in negotiations and any changes in energy market dynamics.
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The market is caught in a tug-of-war between peace hopes and reality checks. While the Iran ceasefire holds, reports of “violations” have reminded investors just how fragile this 14-day window really is.
- The Truce is Fragile: The US Dollar found support after Iran claimed the ceasefire was violated yesterday. It’s a clear signal: the de-escalation narrative is under fire, and volatility isn’t dead yet.
- Hormuz Watch: All eyes remain on the Strait of Hormuz. Any sign of increased tanker traffic will act as an asymmetric trigger, favoring high-beta/Emerging Market currencies and putting more pressure on the Dollar.
- Fed’s Dual Risk: FOMC minutes reveal a divided Fed. While hawkish for now, they are prepared for faster rate cuts if the war leads to significant job losses. Markets are currently pricing in only 7bp of easing by year-end.
- Euro’s “Sticky” Advantage: Unlike the Fed, ECB rate hike pricing (approx. 50bp) remains stubborn. This “sticky” hawkishness is expected to push EUR/USD back toward the 1.170-1.173 range.
- Sterling Under Pressure: The British Pound (GBP) faces downside risks against the Euro. With the Bank of England likely to turn dovish faster as energy prices drop, EUR/GBP is eyeing a return to 0.880.
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- In the US, Nasdaq futures traded lower today as optimism surrounding the US-Iran ceasefire faded. This pre-market caution follows a strong Wednesday session where the Nasdaq Composite surged 2.8% . That rally had heavily benefited travel stocks like United Airlines on the prospect of reduced fuel costs. However, renewed geopolitical friction has since capped further upward momentum in major tech and growth equities.
- In Europe, the German DAX 40 index fell over 1%, erasing a large portion of its prior gains. The downturn was triggered by mounting doubts over the stability of the Middle East truce. Selling pressure was heavily concentrated in industrial, technology, and automotive sectors. Equities including Rheinmetall, SAP, Mercedes-Benz, and Siemens Energy led the declines with losses exceeding 2%.
- In the Asia-Pacific region, Japan’s Nikkei 225 index snapped a four-session winning streak, declining 0.73% . Early gains fueled by Wall Street quickly evaporated as traders opted to secure profits amid the fragile geopolitical environment. The technology sector faced notable headwinds, with semiconductor and AI-linked companies such as Advantest and SoftBank Group recording losses as broader market caution set in.
- Brent crude oil markets saw a sharp upward reversal, with futures rebounding 2.4%. This recovery immediately follows a massive price drop earlier in the week. The renewed surge was a direct reaction to reports that the provisional ceasefire is unraveling after fresh military strikes in Lebanon. Additionally, maritime sources confirmed the Strait of Hormuz remains closed to international transit.
