The big headline over the weekend was the US striking inside Iran to destroy several nuclear related facilities. Investors waited nervously for a possible Iranian response, and for global financial markets to begin trading. And interesting enough, the Israel MSCI stock index hit a record high today (see Looking Ahead). The Shanghai index was higher by +0.65%, the Hang Seng rallied +0.67%, the Nikkei 225 slipped -0.13% lower. The DAX index retreated -0.35%, the Stoxx 600 lost -0.28% and the FTSE 100 edged down -0.19%. 10-year Bunds yield 2.509%. The June PMI Flash Composite Index ticked up from 52.1 prior to 52.8, with the Manufacturing Index going from 52.3 to 52.0 vs. 51.0 est., and the Services Index edging up from 52.3 to 53.1 vs. 53.0 consensus. Existing Home Sales for May increased from an annual rate of 4.00M to 4.03M, above 3.950M est., for a MoM gain of +0.8% (vs. -0.5% prior) and a YoY print of -0.7% vs. -2.0% prior. 10-Yr T-Notes yield 4.395%. The Sep. US$ index sold off -0.31% to 97.975. Aug. crude oil plunged -8.45% to $67.57. Aug. gold edged upwards +0.14% to $3,390.20. After-hours US stock index futures gapped lower on the open. During the day stocks went positive, then Iran responded to US missile strikes by firing missiles at US bases in Qatar and Iraq. Stocks sold off, but just as quickly recovered to close strong.

The Shanghai index was fractionally higher by +0.04%, the Hang Seng fell -1.12%, the Nikkei 225 rallied +0.90%. The DAX sank -0.50%, the Stoxx 600 lost -0.36% and the FTSE 100 edged up +0.11%. 10-year Bunds yield 2.500%. For the week of 6/13 MBA Mtge Apps plunged from +12.5% to -2.6%, Purchases sank from +10.3% to -3.0%, Refinances sank from +15.6% to -2.1%, and the EIA reported Crude Oil Inventories sinking from -3.6M bbls to -11.5M bbls. May Housing Starts fell from 1.392M to 1.256M, Permits dropped from 1.407M to 1.393M (weakest since covid lockdowns). For the week of 6/14 Initial Jobless Claims dipped from 250K to 245K vs. 244K est. The June Atlanta Fed Bus. Inflation Exp. printed at +2.4% YoY, down from +2.5%. The Fed held rates, and still sees 2 rate cuts and higher inflation due to tariffs in 2025 (see Looking Ahead). 10-Yr T-Notes yield 4.395%. The Sep. US$ index added +0.10% to 98.490. Aug. crude oil was -0.16% lower to $74.76. Aug. gold retreated -0.56% to $3,388.10. Overnight Pres. Trump said Iran reached out and wants to negotiate, and he told PM Netanyahu to “keep going.” Meanwhile, the Iranian Ayatollah said “we will never surrender.” US Stock Index futures rallied overnight and maintained strength after the open. A late selloff pushed the ES and NQ into the red, but they recovered to end near even.

The Shanghai index was fractionally lower, the Hang Seng retreated -0.34%, the Nikkei 225 rallied +0.59% (the BoJ held rates steady). The DAX sank -1.12%, the Stoxx 600 lost -0.85% and the FTSE 100 dipped -0.46%. 10-year Bunds yield 2.537%. May Retail Sales sank from -0.1% to -0.9%, vs. est. of -0.6% (Ex-Vehicles went from 0.0% to -0.3% vs. +0.2% expected). May Import Prices went from +0.1% prior to 0.0% vs. -0.3% est. (YoY ticked up from +0.1% to +0.2%). Export Prices sank from +0.1% to -0.9% vs. -0.1% est. (YoY dipped from +2.0% prior to +1.7%). May Industrial Prod. was -0.2% from 0.0% prior, vs. +0.1% est., Mfg. Output improved from -0.4% to +0.1% as est., and Capacity Utilization was 77.4% (77.7% prior) vs. 77.7% est. April Bus. Inventories were steady at 0.0%. The June Housing Market Index fell from 34 to 32 (near 13-yr lows), below 36 est. 10-Yr T-Notes yield 4.392%. The Sep. US$ index jumped +0.86% to 98.390. Aug. crude oil spiked +4.54% to $75.04. Aug. gold dipped -0.26% to $3,408.00. Yesterday, Pres. Trump called for the evacuation of Tehran, and he left the G7 meeting early (see Looking Ahead). Stocks were marginally lower overnight and after the open, then consolidated in slightly negative territory. Pres. Trump called for Iran to surrender, and Iran warned Israelis to evacuate. Stocks sold off to end firmly red.