US equity markets surged overnight, with the Dow Jones hitting another record high as investors welcomed reports of progress towards a potential end to the Middle East conflict. Despite Hezbollah rejecting the latest ceasefire proposal, markets chose to focus on the broader diplomatic momentum. The improved risk sentiment pushed the dollar and Treasury yields lower, while oil fell sharply on easing geopolitical concerns. Gold rallied 0.95% to $4,473.89 on the weaker dollar. All eyes now turn to today’s Non-Farm Payrolls, which will set the tone for Fed rate cut expectations heading into the weekend.
📊 Equities
US equity markets moved sharply higher overnight, with the Dow Jones surging to another record high. Investors welcomed reports suggesting progress towards a potential end to the conflict in the Middle East, choosing to focus on the broader diplomatic momentum rather than Hezbollah’s rejection of the latest ceasefire proposal.
🛢️ Oil
Oil prices fell sharply as geopolitical concerns eased. The prospect of diplomatic progress in the Middle East prompted traders to unwind some of the recent risk premium built into crude prices.
🥇 Gold
Gold prices rallied 0.95% to $4,473.89, supported by the weaker US dollar. While improved risk sentiment tempered safe-haven demand, the softer greenback provided a meaningful offset and kept gold bid on the session.
💵 FX & Bonds
The improved risk sentiment saw the US dollar and Treasury yields move lower as haven demand eased. Market optimism around diplomatic progress dominated FX and bond market price action on the session.
📌 Today’s Focus
Attention now turns to today’s US employment report. The Non-Farm Payrolls release is expected to be the key focus for markets heading into the weekend. A strong reading could reinforce the Fed’s cautious stance on rate cuts, while a softer number may reignite expectations for easing later in the year.
🔹 US Non-Farm Payrolls (NFP)