From Missiles to Markets: A Ceasefire That Moved Billions

🌍 Ceasefire Sparks Risk-On Rally

• A tented “forever” ceasefire between Israel and Iran, mediated by Washington, eased geopolitical tensions—even as Iran reportedly continued missile activity shortly after the announcement (reuters.com).

• Global equities surged: S&P 500 & Nasdaq rallied ~1%, with Europe and Asia also climbing .

• Oil plunged: U.S. crude near $66.15–$66.80, erasing conflict-driven gains (reuters.com).

• Gold and USD fell, while safe-haven demand eased (thetimes.co.uk).

Financial angle: Lower oil cools inflation, easing pressure on central banks. Equities rally benefits cyclical & financial stocks; bond yields reflect rising odds of Fed cuts.

🇺🇸 Fed Deepens Dovish Pause

• Fed Vice Chair Bowman hinted at a July rate cut; other Fed figures are watching consumer-price data closely (reuters.com).

• Powell begins high-stakes testimony today, with markets weighing whether inflation-slowing trends or labor constraints will dictate policy (marketwatch.com).

Financial angle: Lower yields and dovespeak reinforce equity rallies. But investors should brace for volatility tied to Powell's messaging and upcoming PCE prints.

🇨🇦 Canada’s Political Landscape Shifts

• PM Mark Carney engaged peers at the NATO summit—Canada signals unity amid U.S. tariff tensions (bnnbloomberg.ca).

• Canada-U.S. backlash persists: a grassroots “Buy Canadian” movement remains strong after tariff threats (en.wikipedia.org).

• TSX futures rose +0.2%, buoyed by global risk appetite and easing tensions (reuters.com).

Financial angle: Ongoing trade tensions mixed with dovish U.S. yields may support TSX defensives (utilities, materials). Watch currency moves: CAD could strengthen on risk-on flows.

💼 Trade Deficit and Growth Concerns

• U.S. March trade deficit widened to $140.5B, driven by surging imports (+4.4%) (bea.gov).

• Domestic business activity slowed in June; sustained price pressures remain .

Financial angle: Persistent external deficits and slowing activity challenge the Fed’s dilemma—cool inflation without triggering recession. Increased chatter about yield curve support.

🔭 Markets to Watch

• Fed Chair Powell’s testimony (June 24–25): rate guidance, inflation outlook

• U.S. PCE report (Thursday): key inflation signal

• NATO Summit: could produce announcements affecting defense and energy stocks

📊 Financial Snapshot

• S&P 500: +1% (tech & banks lead the charge)

• Oil (WTI): –3% to $66–67/bbl—supporting global disinflation

• Treasury Yields: 10-year falls as rate-cut odds rise

• Dollar: Weakens vs. euro/yen—risk-on momentum

• TSX Futures: +0.2%, bolstered by global rally (home.saxo, bnnbloomberg.ca, invesco.com, reuters.com)

⚡ Quick Take Action Items

1. Equities: Continue overweight in cyclicals (banks, industrials) while inflation cools.

2. Bonds: Watch 10-yr and 2-yr yields—short-term could dip post-Powell, mid-term depends on PCE.

3. Energy: Oil remains in a downtrend; tactical long in energy services only.

4. Canada: TSX technicals supportive; cyclicals and materials are attractive—hedge USD exposure.

🧠 Quote of the Day

Why it fits:
Today’s ceasefire, shifting monetary tone, and synchronized market relief are no coincidence. Behind every macro move is someone pulling a string, or hedging one.