Today's Update 06-13-2025

Key Points and Metrics

Key Points and Metrics:

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Market Overview:

• Geopolitical Tensions in the Middle East:

  • Israel Airstrikes on Iran:

    • Israel conducted airstrikes targeting Iran's nuclear and ballistic missile facilities, significantly escalating tensions in the Middle East.

    • Iran has vowed to retaliate, promising a "harsh response," which has increased concerns over regional stability.

• Impact on Financial Markets:

  • Oil Prices Surge:

    • Brent Crude Oil prices surged by up to 13%, marking the largest intraday gain since March 2022, and settled up 8.3%.

    • The spike is due to fears of potential supply disruptions in the oil-rich Middle East region.

  • Stock Markets Decline:

    • U.S. Stock Futures:

      • S&P 500 futures declined by 1.2%.

      • Nasdaq 100 futures also fell amid the heightened uncertainty.

    • Global Equities:

      • Asian and European stock indices faced declines as investors moved away from riskier assets.

  • Safe-Haven Assets Rise:

    • Gold prices increased by 1%, reaching a one-month high as investors sought safety.

    • The U.S. Dollar Index recovered by 0.4%, indicating a shift toward safer currencies.

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Economic Data Releases:

• Canada:

  • Manufacturing Sales MoM (April):

    • Actual: -2.8%

    • Forecast: -2.0%

    • Previous: -1.4%

  • Wholesale Sales MoM:

    • Actual: -2.3%

    • Forecast: -0.9%

    • Previous: 0.2%

  • Capacity Utilization Rate:

    • Actual: 80.1%

    • Forecast: 79.8%

    • Previous: 79.8%

• Eurozone:

  • Industrial Production MoM (April):

    • Actual: -2.4%

    • Forecast: -1.7%

    • Previous: 2.6% (Revised to 2.4%)

  • Industrial Production YoY:

    • Actual: 0.8%

    • Forecast: 1.2%

    • Previous: 3.6% (Revised to 3.7%)

  • Trade Balance:

    • Actual: €14.0 billion

    • Forecast: €18.3 billion

    • Previous: €28.0 billion (Revised to €28.8 billion)

• United Kingdom:

  • Bank of England Inflation Expectations Survey:

    • 5-Year Ahead Inflation Expectations: 3.6% (Previous: 3.4%)

    • May Inflation Expectations: 3.2% (Previous: 3.4%)

    • Public confidence in the BoE's control of inflation rose to +6 from +1.

• Germany:

  • Consumer Price Index (CPI) YoY (May Final):

    • Actual: 2.1%

    • Forecast: 2.1%

    • Previous: 2.1%

  • Wholesale Price Index YoY:

    • Actual: 0.4%

    • Previous: 0.8%

• Spain:

  • CPI YoY Final:

    • Actual: 2.0%

    • Forecast: 1.9%

    • Previous: 1.9%

  • CPI MoM Final:

    • Actual: 0.1%

    • Forecast: 0.0%

    • Previous: 0.0%

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Corporate News:

• Walmart (WMT) and Amazon (AMZN):

  • Both companies are contemplating issuing their own stablecoins, according to a Wall Street Journal report.

  • This move would depend on the provisions of the GENIUS Act.

  • Merchants are also exploring accepting stablecoins from suppliers.

• Adobe Inc. (ADBE):

  • Q2 Earnings Report:

    • Revenue: $5.87 billion (Estimate: $5.80 billion)

    • Adjusted EPS: $5.06 (Estimate: $4.98)

  • Q3 Guidance:

    • Revenue: $5.88 to $5.93 billion (Estimate: $5.88 billion)

    • Adjusted EPS: $5.15 to $5.20 (Estimate: $5.11)

  • Full-Year Outlook Raised:

    • Revenue: $23.50 to $23.60 billion (Previous: $23.30 to $23.55 billion)

    • Adjusted EPS: $20.50 to $20.70 (Previous: $20.20 to $20.50)

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Other Notable Developments:

• U.S. and Iran Relations:

  • Statements from Former President Trump:

    • Urged Iran to "make a deal before there is nothing left."

    • Emphasized that "it will only get worse" and highlighted the strength of U.S. and Israeli military capabilities.

    • Asserted that Iran must act before it's "too late" to save what was "once known as the Iranian Empire."

• International Responses:

  • United Nations:

    • Iran has called for an urgent UN Security Council meeting regarding the Israeli attacks.

    • The International Atomic Energy Agency (IAEA) reported no increase in radiation levels at Iran's nuclear sites.

  • European Union:

    • EU member states are considering sanctions and have held discussions regarding the situation.

    • The EU plans to ban LNG terminals from servicing Russian customers under long-term contracts from December 31, 2027.

• Central Bank Activities:

  • People's Bank of China (PBoC):

    • Plans to conduct a 400 billion yuan 6-month outright reverse repo operation on June 16.

  • Bank of Japan (BoJ):

    • Offered to lend government debt on the spot in an afternoon offer.

• Trade and Commerce:

  • U.S. Trade Policies:

    • U.S. Commerce Secretary commented that China tariff pauses likely won't be extended.

    • The U.S. is considering invoking the Defense Production Act for rare earth minerals amid strategic concerns.

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Key Economic Indicators to Watch:

• Upcoming Data Releases:

  • University of Michigan Consumer Sentiment (Preliminary)

  • Chinese Economic Data:

    • New House Prices YoY

    • Urban Investment YTD YoY

    • Retail Sales YoY

    • Industrial Output YoY

• Events:

  • G7 Summit (June 14-16):

    • Discussions likely to focus on global economic issues and geopolitical tensions.

  • ECB Speakers:

    • Comments from officials may provide insights into future monetary policy directions.

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📈 UPCOMING DATA RELEASES

• University of Michigan Sentiment (10:00 ET): Expected 52.2 vs 53.6 prior

• Baker Hughes Rig Count (13:00 ET): Previous 442 oil rigs

• Canadian data disappointing: Manufacturing Sales -2.8% vs -2% expected

💰 CORPORATE HIGHLIGHTS

• Amazon (AMZN) and Walmart (WMT) exploring stablecoin issuance

• Nvidia CEO meeting with German Chancellor on AI cooperation

• Travel stocks under pressure due to Middle East tensions

🌍 GLOBAL IMPACT

• Iran closed airspace, emergency cabinet meeting called

• China offering property development policy support

• EU implementing new Russian LNG sanctions from 2026

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Final Thoughts

This is exactly the kind of market environment that separates seasoned traders from the rookies. We're seeing a textbook flight-to-quality scenario, but with some interesting twists. Oil's massive spike is understandable given Iran's role as a major supplier to China and India, but the relatively muted Treasury response suggests markets aren't pricing in a prolonged conflict yet.

What's fascinating is the dollar's recovery from that 3-year low - geopolitical tensions are reminding investors why the greenback remains the ultimate safe haven. The energy sector rotation is happening in real-time, and those defense stocks are already pricing in increased military spending.

Keep your eyes on crude oil's curve structure and whether this geopolitical premium sustains. If tensions escalate further, we could see $100+ oil again, which would completely reshape the inflation narrative. The Fed's going to be watching this closely - energy price spikes could complicate their dovish pivot plans.

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Disclaimer: This article is for informational purposes only and does not constitute investment advice. Always do your own research and consider your financial situation before making investment decisions.

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Harry