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Oil prices rise on the back of stalled peace negotiations while Wall Street stocks fall
Oil futures rose Monday as energy supplies were tight and U.S.-Iran talks had stalled. Wall Street equity indices also declined, as investors remained cautious ahead of a busy week that will include megacap earnings reports, economic data, and central bank decisions. A ceasefire has halted the fighting sparked by the U.S. and Israeli strikes on Iran two month ago. However, shipping through Strait of Hormuz is still very limited. This has pushed Brent futures up to their highest level in almost three weeks. After U.S. president Donald Trump cancelled a weekend visit by his envoys, the outlook for Middle East negotiations remained uncertain. He said Iran should call when it wants a deal. Sources from Pakistan, the mediator country, said that efforts were still being made to bridge gaps between Iran and the U.S. According to Phil Blancato of Osaic Wealth, New York, while investors worried about the war they also waited for economic data and quarterly earnings reports. This week, the data will include the first-quarter U.S. The Federal Reserve prefers to measure inflation by the Personal Consumption Expenditures Prices Index (March) and economic growth. We're at a holding-on point. Blancato said that he did not believe the market would grind much higher. The market is holding on to gains and waiting for further information that will support the direction we have taken this year. Microsoft, Alphabet and Meta Platforms will all be reporting quarterly results on the same day, but Apple's results are scheduled for a week later. Wall Street at 11:04 am. ET (1504 GMT),?Dow Jones Industrial Average dropped 152.37, or 0.31 %, to 49.079.18. The S&P 500 declined 12.12, or 0.17 %, to 7,153.03, and the Nasdaq Composite was down 88.59, or 0.35 %, to 24,748.79. The MSCI index of global stocks rose 0.66 points or 0.06% to 1,072.86. Meanwhile, the pan-European STOXX 600 fell by 0.38%. INTEREST RATE AND TECH EARNINGS The U.S. Dollar slipped Monday, as investors were nervous about the Middle East. Also, a number of central bank meetings are scheduled for this week. The dollar index which measures the greenback versus a basket including the yen and the euro fell by 0.26%, while the euro rose 0.11% to $1.1733. The dollar fell 0.08% against the Japanese yen to 159.24. The U.S. Federal Reserve is expected to hold policy this week. The Fed meeting that?runs from Tuesday to Wednesday will probably be the last one with Jerome Powell in charge. The Bank of Japan will meet first, and is expected to maintain its short-term rate at 0.75% on Tuesday. Both the European Central Bank (ECB) and the Bank of England should keep their policies unchanged. On the bond market U.S. Treasuries were sold off in anticipation of a wave of new issuance at the front of the curve, which is expected to test the demand for government debt of the country once again. The yield on the benchmark 10-year U.S. notes increased 2.3 basis point to 4.334% from 4.31% on Friday. Meanwhile, the 30-year bond rate rose 2.5 basis points at 4.9409%. The yield on the 2-year bond, which is typically in line with expectations of interest rates for the Federal Reserve, increased 2.8 basis points, to 3.804%. Energy prices rose by 3.29% to $108.75 a barrel. U.S. crude oil rose by?2.85%. Gold prices fell as inflation fears were stoked by high oil prices. Spot gold dropped 0.88% to $4667.24 per ounce. U.S. Gold Futures dropped 0.61% to $4693.40 per ounce. Reporting by Sinead carew in New York; Sophie Kiderlin and Tom Westbrook, in London; Additional reporting from Dhara Ranasinghe, in London; Editing and production by Gareth Jones and Alex Richardson.
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Al-Qaeda group claims Mali army has left a northern town due to the spread of insurgency
Al Qaeda’s West -Africa affiliate announced on Monday a withdrawal of the Mali army from the northern town of Tessit as insurgents continue their offensive, which began with attacks across the country and near the capital. The announcement comes two days after JNIM, a rebel group affiliated with the JNIM, and other groups claimed responsibility for attacks that included the killing of the defence minister and the destruction of the main army base near Bamako in the south. Requests for comment from a Mali government spokesperson and an army spokesperson were not immediately answered. The news of new rebel gains will raise concerns about the stability?of?the landlocked Sahel nation that has fought islamist insurgents more than a ten-year war and survived three coups since 2012 RUSSIAN PARAMILITARIES LEAVE TOWN ?FURTHER NORTH JNIM, Jama'at Nusrat Al-Islam Wal-Muslimin, said in a statement on Monday that it would allow Malian forces to withdraw and hand over their weapons. After fierce fighting at the weekend, the paramilitary Africa Corps group, controlled by the Russian Defence Ministry, announced earlier on Monday that its forces were withdrawn from Kidal, located around 375km north of Tessit. Since taking power in 2020, the Mali military government led by Assimi Gouta has sought to strengthen defence cooperation with Russia, while shunning Western partners. Goita is not seen in public since Saturday's attacks. ARMY SAYS?FORCES RESPONSIBILITY AROUND KIDAL Mali's chief of the army, General Oumar diarra, said on Sunday night to the state broadcaster that the military has tactically repositioned its forces in Kidal, and that ongoing operations are taking place in the region. Kidal was a former'stronghold' of the Azawad Liberation Front (FLA), a Tuareg-dominated group that worked with JNIM in order to carry out the attacks on Saturday, which analysts and diplomatics described as being the largest coordinated insurgent attack in?Mali for years. Bamako did not provide an "overall death count" for the violence. A government spokesperson expressed his condolences to "all civilians and military who died" in a statement broadcast on state TV on Sunday, without giving a specific number. (Reporting and editing by Andrew Heavens; Bamako Newsroom, Jessica Donati, Robbie Corey Boulet. Additional reporting by Jessica Donati.
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Critical Metals buys European Lithium at a price of $835 Million
U.S.-based Critical Metals signed a letter of intent to buy all shares of European Lithium for a?about $835million deal. This move would secure the company's full ownership of Greenland’s Tanbreez Rare Earth Project. After the announcement made on Monday, shares of Critical Metals, who currently hold a 92.5% stake in one of world's largest rare earth deposits, rose more than 6%. European Lithium, a mining and development company, owns the 7.5% remaining interest in the project. Tanbreez is a project that has been hailed as an alternative source of heavy rare earths. These are used in electric cars, medical equipment and oil refinement, wind turbines, defense, and other applications. Critical?Metals stated that the ownership of Tanbreez as a whole would simplify the decision-making process and the financing strategy, while the project moves towards a final development decision. Reports from late last year indicated that the Trump Administration had discussed acquiring a stake in Critical Metals. This would give Washington a direct involvement in the Tanbreez Project. Critical Metals spun out of European Lithium in 2024 by combining the?flagship Wolfsberg Project in Austria with an acquisition corporation for special purposes, called?Sizzle. According to the latest deal that is expected to be finalized in the second half?of?this?year, European Lithium holders would receive 0.035 shares of Critical Metals per each held. Both companies share senior management. Dietrich Wanke is the President of Critical Metals European Operations. (Reporting and editing by Shilpa Majumdar in Bengaluru)
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Gold prices ease as attention turns to important central bank meetings
Gold prices eased Monday as a lack diplomatic progress to 'end the Iran War' kept oil and inflation high. The focus now turns to the key central bank meetings scheduled for this week, which will provide updates on the economic impact of the conflict. At 9:28 am EDT (1328 GMT), spot gold was down by 0.2% to $4,698.27 an ounce. U.S. Gold Futures?for June Delivery were down 0.4% at $4,722.60. "Geopolitical tensities are still high but not as intense." "High levels of volatility in prices have likely scared off some Western investors, with inflation expectations on extended oil price high." said independent analyst Ross Norman. Pakistani mediators said that despite the absence of face-toface diplomacy, efforts to resolve differences between Washington, D.C., and Tehran had?not stopped,' despite President Donald Trump cancelling a trip for his envoys, and saying Iran should call if it wanted a deal. Brent oil rose above $105 a barrel, reaching a three-week-high as the Strait of Hormuz was largely closed. This squeezed global oil supplies. Oil prices have soared due to the U.S. and Israel?war against Iran, fueling inflation fears. This has also raised concerns about interest rates remaining high for a longer period of time. Gold is seen as a hedge against inflation, but high interest rates make it less attractive. Investors will also be watching the major central bank meetings that are taking place this week to see how the policymakers assess the impact of the war on the global economic climate and what the future path for rates is. The Federal Reserve will meet in Washington, D.C. for what may be Jerome Powell’s last meeting. Powell will hold a news conference after the central bank releases its policy statement on Wednesday at 2:00 pm EDT. Spot silver dropped 0.3%, to $75.42 an ounce. Platinum fell 1.2%, to $1,986.85. Palladium fell 1.5%, to $1,473.61. (Reporting by Ishaan Arora in Bengaluru. Mark Potter edited the article.
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McGeever: Forget fiscal discipline; record government debt is here to remain
Leaders are warned that government debt levels in the developed world are sky-high. But in an era of increased military spending, resource nationalism, and technological arms races, this call is almost certain to fall on deaf ear. Fiscal watchdogs must stop pretending that they are not. The fiscal situation has worsened, despite the fact that economic growth in recent years has been robust. The U.S. and many other developed countries have the highest public debt as a percentage of their gross domestic product in decades. At its spring meeting this month, the International Monetary Fund sounded a familiar note by calling on governments and their debt to reduce. The window of opportunity for a "orderly" change is rapidly closing, and fiscal buffers that were needed to stabilize the debt-to GDP ratios are all but gone. The IMF stated that "credible and well-sequenced financial adjustment is urgently required across all countries groups." You're in luck. This debt spiral is unlikely to reverse in a world of balkanized countries that are competing for resources, tech, energy and defense. FISCAL DOMINANCE Donald Trump's return as president has accelerated the loose fiscal policy. Allies and rivals are spending heavily because of the U.S. President's?foreign and trade policy. The need to keep pace with the artificial-intelligence revolution is a major factor. A World Bank report published last month said that "industrial policy is back and with a "vengeance"," and should be included in all national policies. According to the IMF?China is pursuing a annual industrial policy worth around 4% GDP while Japan unveiled an historic 21 trillion yen fiscal package earlier this year. That was before the Iran War. The United States of America itself. According to Fed Chair nominee Kevin Warsh, the U.S. deficit is currently running at 6% GDP. This is a staggering level, given that, according to Warsh, the economy is nearing full employment. The Congressional Budget Office estimates that the deficit will reach 7% over the next decade. Add to that the ageing population in the developed world, and you've got a recipe for high inflation and "entrenched fiscal dominance". 'HIGHLY UNDERPRICED?' Does this debt-laden market outlook reflect today's prices? BNP Paribas' strategists recently described fiscal risks as being "highly underestimated." Investors may be aware of the risks, but they are willing to gamble on the loose fiscal policy, believing that the potential benefits to industries, sectors, and assets will offset any risk of a large-scale debt crisis. The fiscal taps could also need to remain open to ensure that the global economy remains robust enough to meet the needs of aging societies. According to fund manager Jeroen Blockland, "You can buy GDP growth by borrowing," and the sustainability of debt "depends on low interest rates" and high inflation. As long as real economic growth exceeds inflation-adjusted rates of interest, the current debt and deficit dynamics are not unsustainable. In theory, risk assets will continue to rise in price as the debt is inflated. The IMF predicts that real growth in this year will reach 2.3%. The current dynamic, despite the dire predictions of debt doomsayers, may not be as bad as they claim. It is in fact a good backdrop for stocks, commodities and energy, especially. Fixed income is not the same. Bonds could have a very bearish decade in the future if inflation is high and continues to reduce returns. Blokland recommends holding no bonds or cash at all, and instead focusing on rare assets such as gold or bitcoin. NATIONAL CHAMPIONS Investors might want to consider a novel strategy in the new era where "big government" is searching for national champions. Intel's relationship with the Trump administration is an example. The government bought a 10% stake last August. The company's shares soared to a new high on Friday, surpassing the peak of the dotcom era. They are now up 85% in just one month. This means they trade at an astonishing 90 times earnings. Does it seem a stretch to describe Intel as the U.S.'s sovereign chipmaker? Up until recently, many governments - especially those in the United States - would have considered it an extreme and rare step to invest in publicly listed companies. Picking winners is now just one part of the expanding fiscal and industrial policy landscape. The rules have changed, and no amount finger-pointing about fiscal issues will change this. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. Follow ROI on LinkedIn and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets seven days a weeks.
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Hungary and EU discuss release of billions in blocked funds
On Wednesday, top EU officials will meet with the new government of Hungary to discuss?the changes Budapest must make to unlock?17 billion euro in EU funds which were blocked by the previous government due to concerns about rule of law. The 'frozen' funds, including 11 billion euros ($13billion) from the Post-Pandemic Recovery Fund must be withdrawn by mid-August or they will be irrevocably lost. The European Commission announced that Ursula von der Leyen, President of the European Commission and Peter Magyar, Hungary's new Prime Minister will be present at the meeting. Both sides have met at least twice since April 12, when the Magyar's Tisza party won a sweeping election. This gave him the two-thirds majority required to change the constitution. EU officials claim that he can make the necessary "legal" changes to unlock funds in a timely manner due to his supermajority. Olof Gill, a Commission spokesperson, told a Monday news conference that the meetings were centered on how to 'progress in unblocking EU funding earmarked for Hungary. He said: "We will engage with the new Hungarian government in a structured, focused manner to ensure that every action is taken at the earliest possible stage to benefit the people of Hungary. The Commission frozen access to funds because the outgoing 'Viktor Orban government did not comply with EU standards on rule of law. The discussions will be centered on the steps that need to be taken to unblock funds. However, they could also cover issues like?Hungary's return to Erasmus student exchange scheme, which has been suspended since 2023 due to concerns about academic freedom in Hungary. Officials said that they could include lifting Hungary's outgoing Government's veto on?EU refunds of military equipment sent by individual EU countries to Ukraine since 2022 to help Kyiv repel the Russian invasion. Reporting by Jan Strupczewski, Editing by Alison Williams.
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Oil prices rise on the back of stalled peace negotiations, resulting in higher global stocks
Oil futures rose Monday - as stalled U.S. - Iran peace talks indicated further disruption of Middle East energy exports. Global stocks also rose to'start a busy tech week with earnings reports and central banks decisions. Benchmark Brent crude futures are?up?just?a little more than 1% to $106.47 per barrel. They had traded at a session high of $108.50 earlier. MSCI's All-World Index rose by around 0.2% while Europe's STOXX 600 gained 0.53%. Markets in Asia rose to near record highs on a wave of AI-fueled optimism. Wall Street futures were largely steady. It's going to be a busy week. "It's going to be a busy week," says Michael Brown, senior researcher at Pepperstone. A ceasefire has frozen the majority of the fighting that was sparked by the U.S. and Israeli strikes on Iran a few months ago. However, the markets are still focused on the closed Strait of Hormuz where very few ships with cargoes of gas or oil have crossed. The future of peace talks remains uncertain. The U.S. president Donald Trump cancelled a weekend trip of his envoys and told Iran to call him if it wanted a deal. Meanwhile, Iran's Foreign Minister arrived in Russia on Monday for a meeting with long-time ally President Vladimir Putin. Sources from Pakistan, the mediator country, said that work hasn't ceased to bridge the gap between Iran and the United States. Goldman Sachs analysts raised their year-end Brent crude oil forecasts from $80 to $90 per barrel, based on the expectation that Gulf exports will return to normal by end-June. In a recent note, they warned that "non-linear increases in prices are likely" if inventories fall to critical low levels. INTEREST RATE AND TECH EARNINGS Investors focused on the tech industry and the unstoppable artificial intelligence trend. Mike Seidenberg is senior portfolio manager at Allianz Technology Trust. He said, "AI has a lot of people very excited and it's a very popular technology." It's at the top of your portfolio. Intel's forecast last week that second-quarter revenues would exceed Wall Street expectations triggered the latest round in buying. The total value of the "chipmaker-heavy" stock markets of Taiwan and South Korea now surpasses Germany. Microsoft, Alphabet and Amazon will focus on capital expenditure plans when they report to investors on Wednesday. Apple will follow a day later. The U.S. Federal Reserve, which is likely to be the last meeting of the Jerome Powell-led Federal Reserve, will also keep its policy on hold. Both the European Central Bank (ECB) and Bank of England will also keep their policy unchanged. However, their tone and outlook may affect market pricing for a rate increase later in the year. Bank of Japan is the first central bank meeting, and it's expected to hold its short-term rate at 0.75% on Tuesday. The dollar dipped slightly on Monday. The euro was at $1.1740, and the Japanese yen was just below the 160 mark. (Reporting from Sophie Kiderlin and Tom Westbrook, London; Additional reporting provided by Dhara Raasinghe, London; Editing done by Shri Navaratnam and Thomas Derpinghaus; Gareth Jones, Alex Richardson and Alex Richardson.
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Fitch downgrades Enel Brasil due to risk of losing Sao Paulo concession
Fitch downgraded Enel Brazil's credit rating, citing growing uncertainty about the renewal of the main distribution concession of the subsidiary in the South American country. The agency announced late Friday that it had assigned a negative outlook to all corporate ratings for the unit. Fitch reduced Enel Brasil S.A.'s long-term national rating from AAA to AA+ (bra) and removed the?negative monitor. The downgrade also applies to subsidiaries Eletropaulo Metropolitana Eletricidade de ?Sao Paulo - Enel Sao Paulo - Ampla Energia e Servicos S.A. - Enel Rio - ?and Companhia Energetica do Ceara - Enel Ceara. Brazil's energy regulator began an administrative process earlier this month to potentially revoke Enel Sao Paulo’s power concession that expires in 2020, citing "structural failures" with the provision of services after extreme weather events over recent years. Enel will have another chance to defend itself before the regulator decides if it recommends to the federal government to revoke the concession. Fitch stated that a possible loss of the license would have a significant impact on Enel?Brasil's operating efficiency and profitability. Auditors in the group's annual report said that it has assets of about 3.34 billion euros, and goodwill worth?595 millions euros tied to an electricity concession in Brazil, which it could?lose. Enel Sao Paulo’s third-party debt was $8.4 billion?reais (about $1.75 billion) as of December 2025. This is equivalent to 47% of Enel Brasil’s total consolidated debt. Fitch warned that the outlook may worsen if the concession was not renewed or terminated. ($1 = 4,9795 reais). (Reporting and editing by Alvise Armillini, Francesca Landini)
MORNING BID AMERICAS - Oil and Chips
What's important in the U.S. market and globally today by Mike Dolan, Editor at Large, Finance and Markets
Tech stocks continue to rise despite the weekend's stalemate over Iran, rising oil prices and a close call with a Washington press dinner that was attended by Donald Trump and his officials.
This week, the dissonance between AI and geopolitics is likely to continue. ?Companies that represent 44% of S&P 500 market capitalization will'report earnings' in the next few days. There is no sign yet of a pause in the AI arms races around the globe.
Below, I'll go into more detail. Listen to the Morning Bid podcast for the most recent episode, in which I discuss the busy week that lies ahead. Subscribe to the Morning Bid daily podcast and hear me discuss the most important news in finance and markets seven days a weeks.
Oil and chips Microsoft, Meta Apple, Alphabet, and Amazon all report earnings next week. Meanwhile, chipmakers' stock prices have rocketed on demand for AI components. Intel's dazzling?advance towards record highs has been the highlight of this month. It's unclear how the markets will react to hyperscalers, big tech companies and Tesla who last week increased their 2026 capital expenditure plan by more than $25 billion. For now, tech stocks continue to soar, as chipmakers led Asian indices to new record highs. This comes after Wall Street also hit record highs on Friday, although S&P futures were flat on Monday before the bell. After the opening, European shares were muted. Brent crude has reached a three-week record of $108 a barrel. Traffic in the Strait of Hormuz remains sluggish, and there haven't been any 'new peace talks scheduled yet, though Pakistani efforts continue to broker discussions. Goldman Sachs has also raised its forecast for fourth-quarter Brent to $90/bbl.
The Fed, G7 central bankers, and the Bank of Japan will all be meeting this week. The Bank of Japan is the first to announce its rate decision, which will take place on Tuesday. As they continue to evaluate how energy prices impact inflation expectations, no interest rate changes are expected this week. The Fed meeting is likely to be Jerome Powell's last as chairman. The Department of Justice's decision to drop its criminal investigation into Powell on Friday has cleared the way for Kevin Warsh, the nominee for Fed chair, to be confirmed by the Senate. Powell's guidance may be less effective than in the past eight years.
The week will also bring new inflation data from around the globe, with the U.S. Personal Consumption Expenditures (PCE), the Fed's preferred measure, due Thursday, along with flash data from the Eurozone.
Chart of the Day
U.S. oil exports have increased in the last few weeks, which has helped to calm the energy supply crisis that is originating from the Middle East. According to Energy Information Administration figures, total U.S. crude oil exports reached a record high of 12,9 million barrels per a day in this month. Refined products made up over 60% of the total. According to Kpler, U.S. seaborne oil exports will reach a new record of 9.6 million barrels per day in April. Flows to Asia are expected to nearly double from pre-war levels, to 2.5 million barrels per day. Ron Bousso, ROI Energy's columnist, explains that the surge in oil exports has cushioned Asian economies which are among those most vulnerable to Gulf supply loss.
Watch today's events
* U.S. 2-year & 5-year Note Auctions (1 p.m. EDT)
Bank of Japan starts monetary policy meeting
* UK King Charles III starts four-day U.S. State Visit
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(source: Reuters)