Markets Advance as Easing Middle East Tensions Offset Hawkish Fed Outlook

Index Update

On Thursday, US equities closed higher as tech and semiconductor gains, along with optimism over the US-Iran interim deal, offset hawkish Fed concerns. The S&P 500 rose 1%, Nasdaq 100 gained 1.9%, and Dow added 72 points, led by Intel, Nvidia, Micron, and airline stocks.

Market Movers

Among the top-performing stocks of the session Linkers Industries Limited. surged 67.50%, while FreeCast, Inc. rallied 56.70%. On the losing side, WORK Medical Technology Group LTD. fell 25.93%, while Veraxa Biotech AG. declined 23.55%, making them the weakest performers during the trading day.

Commodities Update

Brent and crude oil prices declined to around USD 79.2 and USD 75.3 per barrel, respectively, as easing US-Iran tensions, progress in Switzerland talks, continued Strait of Hormuz shipping activity, and rising Iranian exports supported expectations of recovering Persian Gulf supply flows.

Gold and silver rebounded to around USD 4,200/oz and USD 66/oz, respectively, as easing US-Iran tensions, lower oil prices, continued Strait of Hormuz flows, and expectations of higher Persian Gulf output helped improve sentiment, while investors awaited the US PCE inflation data amid the Fed’s hawkish policy stance.

Macro Updates

The dollar index held near 100.9, close to its strongest level since May 2025, as hawkish Fed expectations and focus on the upcoming US PCE inflation report supported the currency, while investors also tracked US-Iran peace talks, yen intervention risks, and UK political uncertainty.

Bonds Commentary

The US 10-year Treasury yield rose to around 4.48% as investors weighed progress in US-Iran peace talks and awaited the US PCE inflation report, while the Fed’s hawkish stance and rising expectations of a possible September rate hike continued to support yields.

Futures Update

US stock futures were flat near record highs as Middle East peace optimism supported sentiment and pressured energy prices, while hawkish Fed expectations limited Treasury gains. Chipmakers extended their rally, AI hyperscalers lagged on return concerns, and AbbVie rose after its USD 10.9 billion Apogee deal.

The S&P 500 added 1.08% on the session, closing at 7,500.5 and reclaiming ground after the recent pullback from all-time highs near 7,600. Price continues to hold comfortably above both the 20-EMA (7,306.5) and 50-EMA (7,129.2), keeping the near-term structural bias firmly to the upside. RSI (14) sits at 55.07 — above the 50 midline and trending higher — suggesting that bullish momentum remains intact without yet signalling overbought conditions. As long as the index sustains above the 7,300 zone, dips are likely to attract buying interest ahead of any meaningful retest of the 50-EMA.