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28/05/2026 - 06:48 UTCThe USDX ticked up 0.07% on Wednesday, consolidating its gains near the 99.50 level heading into Thursday’s Asian session. The Greenback attracted solid buying interest as optimism for a permanent Middle East peace deal suffered a severe blow. Tensions re-escalated following reports that Iran's Islamic Revolutionary Guard Corps (IRGC) retaliated against earlier American strikes near Bandar Abbas airport by targeting U.S. military bases. The IRGC explicitly warned of a more decisive military response if faced with further American attacks. This volatile geopolitical backdrop, coupled with persistent energy-driven inflation fears, has prompted market participants to aggressively ramp up hawkish Federal Reserve bets. According to the CME FedWatch tool, the probability of the Fed delivering at least one additional interest rate hike this year has now crossed the 50% threshold.
Gold slumped -1.62% on Wednesday, languishing near the $4,455 mark as a strengthening U.S. Dollar and hawkish interest rate expectations pinned the non-yielding asset down. Bullion bulls remained heavily on the sidelines following comments from U.S. President Donald Trump, who stated he would not be rushed into a diplomatic solution with Tehran and that the U.S. would continue to strictly monitor the Strait of Hormuz. This diplomatic gridlock, paired with rising expectations of tighter monetary policy to curb sticky inflation, keeps the fundamental backdrop heavily tilted in favor of gold bears.
Meanwhile, WTI Oil dropped -3.34% over the course of Wednesday's session, hitting its lowest levels since late April before catching an aggressive, late-day safe-haven bid during early Thursday hours. The sharp overnight reversal was triggered by the fresh exchange of military strikes between U.S. forces and the IRGC in the Strait of Hormuz, alongside weekly API data revealing that U.S. crude stockpiles fell for a sixth consecutive week.
The S&P 500 and Nasdaq secured fresh record highs to open the holiday-shortened week, heavily powered by a four-day winning streak in the technology sector. Leading this upward momentum were semiconductor stocks, particularly memory chipmaker Micron Technology, which has benefited immensely from soaring artificial intelligence demand despite a persistent broader supply glut. This surge briefly pushed Micron's market capitalization past the $1 trillion milestone for the first time ever, following in the footsteps of rival Samsung Electronics, while South Korea's SK Hynix joined the elite $1 trillion club on Wednesday.
While analysts highlight that Micron's robust profit momentum is projected to deliver record sales and after-tax profits through its financial years ending in August 2026 and 2027, some market experts caution that the current parabolic share price charts carry a striking resemblance to the final peak of the 1999–2000 dot-com bubble. On Wednesday, Micron initially opened with solid gains to extend its historic rally, but shares began to seesaw shortly after as broader technology sector momentum cooled. Ultimately, Micron closed the session up 3.71% on Wednesday.
In regional developments, broader markets trended downward on the back of the renewed Middle East friction. On the mainland, the China SSE and the blue-chip China SZSE both moved lower during the session, while the Hong Kong 50 also declined as selling pressure hit technology shares. Simultaneously, equity benchmarks in Tokyo experienced a minor pullback following their historic climb to record highs in the previous session, with the Nikkei 225 and the broader TOPIX index both edging lower for the day.
For the remainder of the week, global financial markets will pivot entirely toward high-stakes macroeconomic data and influential central bank commentary. The immediate focus centers on Thursday's North American session, featuring the U.S. Preliminary GDP print—forecasted to jump to 2.1%—and the April Personal Consumption Expenditures (PCE) Price Index. The core PCE reading, the Fed's preferred inflation gauge, is projected to rise to 3.3% year-over-year, and any hotter-than-expected data will likely cement late-year Fed rate hike expectations. On Friday, attention shifts to European monetary policy as Bank of England Governor Andrew Bailey delivers a highly anticipated speech expected to offer fresh clues on the UK’s interest rate trajectory. On the corporate front, investors will parse critical tech infrastructure spending health tonight, with enterprise hardware giant Dell Technologies and design software maker Autodesk both scheduled to report their quarterly earnings results today after the market close.
The Euro weakened against the US Dollar during Thursday’s Asian trading session, slipping below the 1.1600 mark as investors shifted toward safe-haven assets amid renewed fears of escalating conflict between the United States and Iran.
EUR/USD declined to trade near 1.1590 after reports emerged that Iran had retaliated following alleged US strikes near Bandar Abbas airport. According to local media reports, explosions were heard east of Bandar Abbas, while air defense systems were activated in the area for several minutes.
Market sentiment deteriorated further after Iran’s Islamic Revolutionary Guard Corps (IRGC) reportedly targeted US military bases and warned of a stronger response should Washington launch additional attacks.
The renewed hostilities have dampened expectations for a lasting diplomatic agreement between the two countries. Earlier this week, US officials, including President Donald Trump, had expressed optimism that progress toward a deal could be announced soon.
Investors are now turning their attention to upcoming economic data releases, including the US Personal Consumption Expenditures (PCE) Price Index for April and Germany’s preliminary Harmonized Index of Consumer Prices (HICP) for May, due later this week.
Gold prices traded lower during Thursday's Asian session as investors remained cautious amid ongoing uncertainty surrounding US-Iran negotiations and ahead of critical US inflation data.
Geopolitical tensions remained in focus after US President Donald Trump stated on Wednesday that he would not be pressured into reaching a deal with Iran, adding that Tehran’s attempts to outlast his administration would not succeed because he does not “care about the midterms.”
Trump also emphasized that the Strait of Hormuz would remain “open to everybody,” saying the United States would continue to monitor the strategically important waterway as part of broader negotiations with Iran.
Meanwhile, US Secretary of State Marco Rubio signaled a more diplomatic tone, stating that Washington would give negotiations with Iran “every chance to succeed.” Rubio acknowledged that talks had shown some progress, while reiterating that the US still has alternative options if diplomacy fails.
Market participants are now closely watching the upcoming US PCE inflation report for further clues on the Federal Reserve’s policy outlook. Economists expect the headline PCE Price Index to rise 3.8% year-over-year in April, up from 3.5% previously, while the core reading is projected to increase 3.3%, compared with 3.2% in March.
Stronger-than-expected inflation data could reinforce expectations that the Federal Reserve may keep interest rates elevated for longer or potentially tighten policy further. Higher interest rates typically reduce the appeal of non-yielding assets such as Gold, despite its status as a traditional hedge during periods of geopolitical uncertainty.
Oil prices rallied sharply on Thursday after Iran’s Revolutionary Guard announced it had targeted a US airbase in retaliation for reported American strikes near Bandar Abbas airport, reigniting concerns over escalating tensions in the Middle East.
The rebound followed steep losses in the previous trading session, when both oil benchmarks dropped amid speculation that the United States and Iran could reach an agreement to ease tensions and reopen the Strait of Hormuz.
According to Iranian state-affiliated media, Iran’s Revolutionary Guard launched attacks on a US military base after what Tehran described as a US strike conducted earlier near Bandar Abbas airport. Iranian officials warned that any further military action would trigger a “more decisive” response.
A US official reportedly stated that American forces had carried out additional strikes targeting an Iranian military site believed to pose a threat to US personnel and commercial shipping routes in the Strait of Hormuz.
The renewed escalation has intensified concerns over global energy supply disruptions, particularly given the strategic importance of the Strait of Hormuz, a critical corridor for international oil shipments.
Investors are now awaiting official inventory figures from the US Energy Information Administration, scheduled for release later on Thursday following a delay caused by the Memorial Day holiday earlier this week.
US stocks ended mixed on Wednesday, with the US 30 ending higher as investors shifted toward healthcare and consumer stocks while monitoring ongoing US-Iran negotiations and taking a breather from the recent artificial intelligence-driven rally.
Investor sentiment remained cautious as market participants assessed developments in Middle East diplomacy. US Secretary of State Marco Rubio said negotiations with Iran had shown some progress, although President Donald Trump acknowledged that several issues remain unresolved. Iranian media outlets also reported that key disagreements persist between the two sides.
The market rotation away from technology stocks helped lift defensive sectors, particularly healthcare and consumer staples. Shares of Procter & Gamble advanced 3.16%, while UnitedHealth gained 1.9%, contributing significantly to the Dow’s gains. Financial stocks underperformed after JPMorgan Chase declined 2.4%. The selloff followed comments from CEO Jamie Dimon, who warned that the bank’s annual expenses could exceed previous estimates by approximately $1 billion.
Technology and semiconductor stocks lost momentum after leading recent market gains. Qualcomm dropped 6%, Marvell Technology fell 4.6%, and Intel slipped 1.4%. Nvidia also declined around 1%, while the Philadelphia Semiconductor Index retreated 1.4% after reaching a record high earlier in the week. Despite the pullback in chipmakers, analysts noted that broader market participation remains healthy beyond the AI-driven rally that has dominated equities in recent months.
Investors are now focused on the upcoming US Personal Consumption Expenditures (PCE) inflation report, the Federal Reserve’s preferred inflation gauge, which could provide fresh insight into the future direction of monetary policy.
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