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Last updated: July 21, 2026, 5:30 AM ET

Middle East Tensions Drive Oil Prices and Gold Higher

Brent crude futures settled higher amid escalating U.S.-Iran hostilities, with Goldman Sachs suggesting prices could by year-end if Strait of Hormuz disruptions persist. The renewed conflict also by more than 1%, as mediators pushed for a ceasefire. Meanwhile, yields edged as Middle East tensions raised concerns about oil supply disruptions. The WSJ Dollar Index rose 0.1% for a third consecutive day.

UK Policy Shifts and Market Reactions

New UK Prime Minister Andy Burnham's immediate tax cuts on electricity among investors, causing UK government bonds, or gilts, to drop. Burnham, who has signaled flexibility within fiscal rules, unnerved bondholders on his first day. Separately, lenders to Thames Water to the UK government in a bid to avoid nationalization. In corporate news, shares in Mitie Group soared 40% following an agreed takeover by OCS Group for £3.1 billion.

AI and Tech Stocks Lead Market Swings

U.S. stock futures jumped higher as artificial-intelligence stocks experienced a fresh wave of optimism, lifting Asian and European indexes. Chip stocks, which had previously suffered a bruising selloff, rebounded strongly, contributing to a broader market advance. Despite this, some strategists, like HSBC's Max Kettner, warn of a potential pullback in stocks before the U.S. midterm elections due to stretched sentiment and fading fiscal stimulus. Australia's stock market has, however, emerged as an unlikely haven from AI-driven volatility in other Asian equities. China is reportedly on AI models and chips to prevent Western acquisition of advanced technologies.

Corporate Dealmaking and Financial Results

The London Stock Exchange next year, aiming to offer near-continuous trading and compete with crypto platforms. In dealmaking, Var Energi to buy Blue Nord, increasing its exposure to European gas markets. Icahn Enterprises is set to to Mavis for $700 million. Swiss bank Julius Baer reported its net profits to SFr673 million, driven by a 26% jump in operating income. Law firm Linklaters partners of £2.5 million each, fueled by strong performance in its Asia business and growth in the U.S.

Global Economic Indicators and Currency Movements

The euro was trading higher against the dollar but could if energy prices remain elevated, according to ING. Indonesia has entered the market with its inaugural yuan-denominated bonds in China as it. Meanwhile, New Zealand's annual inflation accelerated to its fastest pace in over two years, supporting the case for further interest rate hikes by the Reserve Bank. Global investors have turned cautious on Indian bonds, with the rupee also under strain due to slowing debt inflows and renewed foreign selling in stocks.

Energy Market Dynamics and Supply Concerns

Oil prices eased as mediators worked towards a U.S.-Iran ceasefire, leaving Brent back below $90 a barrel. However, the U.S. airstrike on a shadow fleet tanker in the Gulf of Oman, which resulted in the deaths of three Indian sailors, highlighted ongoing risks. Another tanker was attacked in the Strait of Hormuz, with Houthi rebels threatening a blockade of Saudi Arabia in the Red Sea. This has prompted Asian nations like Pakistan and Bangladesh to shipments due to choked supply. Abu Dhabi National Oil Company and its partners have decided to proceed with a $6.2 billion Umm Shaif gas cap project.

US Economic Signals and Policy Developments

The Conference Board’s Leading Economic Index in June, reflecting weakening consumer spending. U.S. petrol prices have climbed back above $4 a gallon, adding to consumer frustration ahead of the midterm elections. A federal judge has paused Paramount's proposed $110 billion acquisition of Warner Bros, examining the impact on competition in Hollywood. BlackRock is leading a $12 billion financing for Meta's new data centers in Texas, looking to sell more than $12 billion in bonds.