Morning Wrap: US strikes Iran – what’s next for the negotiations? (25.05.2026)

• Monday brought substantial gains to the markets, driven by reports indicating that Washington and Tehran were nearing the signing of a 14-point memorandum.
  • The German DAX finished the day up 2%, as did the pan-European Euro Stoxx 50. Other European indices also moved higher, alongside S&P 500 and Nasdaq Composite futures (US cash markets were closed yesterday in observance of Memorial Day).

🌍 Geopolitics

• Both sides expressed strong optimism regarding the progress of the negotiations.
  • US Secretary of State Marco Rubio assessed that the talks are about 90-95 percent complete and good news can be expected shortly.
  • Iranian Foreign Ministry spokesperson Esmail Baghaei also noted that the negotiating gaps between the parties are narrowing.
• Overnight, however, reports emerged of a strike by US forces on facilities located in southern Iran, likely near Bandar Abbas. According to the United States Central Command, the fire was directed at Iranian missile launch sites and vessels tasked with mining the Strait of Hormuz.
  • Rubio assured that the strikes will not disrupt the negotiations – the talks taking place in Qatar are now focused solely on the "appropriate language" to be used in a potential agreement between Washington and Tehran.
• Global media are also reporting further Israeli strikes on Lebanon. The shelling reportedly took place in the south of the country, in the Tyre and Nabatieh regions. Benjamin Netanyahu stated: "We are not slowing down; on the contrary, I told them to press the gas pedal even harder."

🌏 Asia

• Mixed sentiment prevails across Asian markets. The South Korean Kospi is reaching new highs (+2.8%), while the Nikkei 225 (-0.4%) and the Shanghai SE Composite (-0.8%) are trading in the red.

💱 Currencies

• In early morning trading, the US dollar is recovering some of the losses incurred on Monday, strengthening against all G10 currencies. The New Zealand dollar and Scandinavian currencies are at the bottom of the pack (down by 0.3-0.4%).

🛢️ Commodities

• Following renewed signs of escalation, crude oil prices are heading higher again. Both WTI ($92) and Brent ($98.30) are up by approximately 2%.
• Conversely, gold is losing ground (-0.9%), currently hovering around $4,530 per troy ounce. This decline is likely driven, at least in part, by a renewed uptick in US Treasury yields.

₿ Cryptocurrencies

• The cryptocurrency market is also pointing lower. Bitcoin is down 0.5%, falling to the $76,800 level. Ethereum is recording a loss of a similar magnitude.

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Michał Jóźwiak, Financial Markets Analyst at XTB