Daily Summary - Oil Nearly Erases War Gains as Wall Street Pulls Back Ahead of Fed Decision (16.06.2026)

🛢️ Commodities

• Oil prices are experiencing their longest losing streak of the year, dragging prices down to near-bottoms and erasing most of the gains triggered by the conflict.

• The market is seeing a heavy hit to the valuations of both major benchmarks—Brent crude is down over 5%, slipping below $80 per barrel, while US WTI has dropped to $75 per barrel.

• Recent reports indicate that the United States is gradually lifting its naval blockade and is set to allow Iran's immediate return to the oil market, a move aimed at easing tensions ahead of further negotiations.

• The agreement is scheduled to be signed this coming Friday in Geneva, though details regarding the full text of the memorandum remain unavailable.

• Wall Street institutions have drastically slashed their forecasts. Morgan Stanley and Goldman Sachs have significantly lowered their price projections for the coming quarters.

• Supply could return sooner than expected, as Goldman Sachs anticipates that Persian Gulf exports will bounce back to pre-war levels by the end of July.

• This situation brings noticeable relief to central bankers, as the drop in commodity prices back to early March levels significantly reduces global inflationary pressures.

• Gold continues its rebound, climbing 0.6% to reach $4,360 per ounce. The gains in precious metals are being driven by cooling inflation expectations.

📈 Stocks and Companies

• Following a previous three-day rally, US stock indices have clearly run out of steam and remain in limbo. S&P 500 and Nasdaq futures are undergoing a sharp correction, with the US500 losing 0.2% and the US100 dropping over 1%.

• SpaceX is seeing an explosion in its valuation. The company's stock jumped another 11% at the opening bell, and looking at the bigger picture, the firm has surged over 50% since its IPO.

• Elon Musk's company continues its valuation sprint, overtaking Amazon today and briefly even passing Microsoft, with SpaceX’s market capitalization hitting an astronomical $2.8 trillion.

• The enterprise is cementing its position as the fifth-largest power on Wall Street. Today, shares were fueled by news finalizing the $60 billion acquisition of Cursor. Theoretically, this values Cursor at a P/S ratio of 15.

🏛️ Monetary Policy and Central Banks

• Today witnessed a historic and highly hawkish move in Asia. The Bank of Japan (BoJ) raised its benchmark interest rate by 25 basis points to 1%.

• This decision marks an unprecedented blast from the past, representing the highest interest rate level in Japan since the 1990s.

• The immediate market reaction to the BoJ's decision was volatile. The Japanese yen completely erased its earlier gains, while local government bond prices fell. USDJPY is nearing the 160.5 level again—a threshold that previously triggered currency interventions.

• The Reserve Bank of Australia (RBA) took a completely different approach, holding interest rates steady for the first time this year. The AUDUSD pair is strengthening today.

• Hawkish pressure also remains palpable in Europe, where investors are keeping last week's ECB move in mind—during which Christine Lagarde raised rates and warned that "war-driven inflation" is spilling over into the broader economy. EURUSD climbed above 1.16 today, though this is primarily driven by broad dollar weakness (excluding the yen).

• Global financial markets are holding their breath in a "calm before the storm" ahead of Wednesday's Federal Reserve (Fed) meeting.

• The event will feature the highly anticipated debut of the central bank's new leader, marking the first Fed meeting chaired by Kevin Warsh.

• While the market consensus expects interest rates to remain unchanged, the primary focus will be on Warsh’s maiden press conference and his official rhetoric regarding the future outlook for inflation.

• The new Fed Chair faces a major macroeconomic dilemma. Warsh will have to balance stubborn near-term price pressures against the prospect of a rapid decline once the Strait of Hormuz is fully reopened.