Asset management.

•    Oil flows passing through the Strait of Hormuz are reportedly overvalued, which, combined with Houthi attacks and rising gas prices, pushed the global commodities index above its 2022 peak.
•    Faced with the sharp rise in government bond yields, US Treasury Secretary Scott Bessent massively increased Treasury buybacks to reassure markets, triggering a drop in the dollar and a surge in precious metals in return.
•    Equity markets racked up serious losses this week. The tech sector was particularly badly hit and this time with additional worries over increasingly powerful Chinese AI models, although future productivity gains remain promising. 

•    Tensions between the United States and Iran, as well as attacks in the Red Sea, are reigniting fears over energy supplies, pushing the price of a barrel of oil towards $100.
•    The US is calling for an additional $87 billion in military spending, whilst Donald Trump has announced further tariff increases.
•    In the eurozone, the slowdown in inflation allowed the ECB to keep interest rates unchanged at its July meeting.

•    This week's inflation data in the US offered markets some unexpected relief.
•    US-Iran tensions are now in a low intensity conflict but the consequences could still prove damaging for commodities.
•    A risk premium on short US rates and the choppy geopolitical context have led to the Momentum Asset trade unwinding, particularly for semiconductors

•    The Middle East conflict had gradually been receding into the background but the resumption of hostilities between Washington and Tehran caught investors off guard.
•    The latest economic data and comments from some Fed governors mean we still cannot rule out a rate hike at the end of July so real interest rates have moved towards new highs.
•    We have turned positive on government bonds as Central bank risk is now largely discounted.