Daily Summary: Trump's War Threats Weigh on Markets. Wall Street Sinks into the Red

📈 Stock Market

• The Wall Street session is dominated by sellers, with the sell-off spreading across the entire market and putting American indices under significant pressure.

• The Dow Jones Index is down about 1%, the S&P 500 declines by roughly 1.2%, while the Nasdaq 100 drops by over 2%.

• Among the main drivers dragging the market down today are Alphabet and Tesla, whose shares are losing noticeably following their quarterly earnings releases.

• Although both companies reported better-than-expected results, investor sentiment remains negative.

• In Alphabet's case, the market is focusing on rising AI expenditures; while the company continues to benefit from a strong advertising core and dynamic Google Cloud growth, investors demand increasingly tangible returns on multi-billion-dollar AI investments.

• Concerns primarily center around high spending weighing on cash flows in upcoming quarters before translating into higher profitability.

• Meanwhile Tesla, despite sales growth and ambitious plans regarding autonomous driving, AI, and the Optimus humanoid robot project, continues to face margin pressure and mounting EV competition.

• Intel's results will be released after today's session, with the company needing to demonstrate that its restructuring efforts are delivering tangible benefits.

• Significant declines dominated the European continent today, leaving most European indices in the red.

• The British FTSE 100 fell 0.7%, the French CAC 40 dropped over 1.6%, the German DAX lost nearly 1.8%, and the Spanish IBEX 35 declined over 1.5%.

🏛️ Macroeconomics

• The ECB (European Central Bank) kept interest rates unchanged.

• US weekly initial jobless claims dropped by 22,000 to just 187,000, reaching the lowest level since 1969 and clearly beating market expectations.

• Labor market data confirms ongoing resilience, supporting the US Dollar and potentially strengthening arguments for the Fed to maintain a hawkish stance.

🌐 Geopolitics

• Escalation in the Middle East is driving a global risk-off sentiment, sparking a marked increase in risk aversion and a flight to safe-haven assets.

• US President Donald Trump stated in an interview with Axios that he is considering a "massive attack" on Iran that would be "bigger than ever before," adding that he is close to making a final decision.

• Markets interpreted these comments as a sign that the conflict could enter a new, significantly more dangerous phase.

• The situation is further escalated by a wave of Iranian missile and drone attacks on targets in Jordan, Bahrain, and Kuwait, following a twelfth night of US strikes on Iranian-linked targets.

• Kuwaiti authorities reported an attack on the Al-Abdali border crossing with Iraq, demonstrating that hostilities are extending further across the Persian Gulf region.

• The US State Department issued a warning, advising citizens in the Middle East to prepare for potential travel disruptions and flight cancellations.

• UN Secretary-General António Guterres warned at a Security Council meeting that the situation in the Middle East is "spiraling out of control" and called for the restoration of freedom of navigation in the Strait of Hormuz and Bab al-Mandab, emphasizing that diplomacy remains the only path forward.

🛢️ Commodities

• Brent crude surged past the psychological $100 per barrel barrier for the first time since May, rising over 6% following Houthi attacks on Red Sea shipping.

• Investor anxiety centers heavily on oil transit security across two vital maritime chokepoints: the Strait of Hormuz and the Bab al-Mandab Strait.

• Iran's Islamic Revolutionary Guard Corps (IRGC) reported intercepting three oil tankers attempting to navigate a mined route south of the Strait of Hormuz; according to the statement, one tanker exploded and caught fire, while the other two retreated.

• Further escalation involving Iran and threats to Persian Gulf shipping could sustain extreme oil market volatility and reinforce global risk-off sentiment.

• The sell-off also extended to most industrial metals.

🪙 Precious Metals

• Deteriorating market sentiment amid rising Middle East tensions is weighing on precious metals.

• Gold is down over 2%, testing the $4,050 level.

• Silver declines by nearly 4%, falling below $60.

💵 Currencies

• As a result of escalating Middle East tensions, the US Dollar is strengthening against major peers.

🪙 Cryptocurrencies

• The broader market sell-off is also hitting digital assets.

• Bitcoin is down nearly 2%, slipping below $65,000.

• Ethereum drops almost 2.5%, sliding below $1,900.