Bitcoin Falls as Israel-Iran Conflict Dents Risk Appetite — Market Talk

0657 GMT - Bitcoin falls as renewed concerns over the Israel-Iran conflict reduces investor appetite for risky assets. "Investor sentiment was shaken after renewed hostilities between Israel and Iran dashed hopes for a truce, as President Trump urged the evacuation of Tehran and summoned the National Security Council," IG analysts say in a note. Risk sentiment briefly improved Monday after the WSJ reported that Iran was seeking an end to hostilities and resumption of talks over its nuclear programs. However, news of another wave of Iranian missiles launched at Israel and more Israeli strikes on Iran sparked worries that the conflict could intensify. Bitcoin falls 1.8% to $106,903, according to LSEG. ([email protected])0655 GMT - Conversations with mid-cap gold companies continue to be focused on growth, cash returns and dealmaking--although not necessarily in that order, say RBC Capital Markets analysts. Their remarks follow RBC's annual mining conference in New York. Buybacks came up in every conversation, say the analysts. And for miners that lack organic growth options, M&A was a key focus, they add. The analysts reckon more gold deals might be coming following Newmont's recent string of asset sales and the positive market response to some other acquisitions. "Management teams continue to broadly preach conservatism on acquisitions, cost containment and gold price assumptions for reserves and project evaluation," they say. "But decisions could be coming on trade-offs between margins and higher/longer production at existing assets." ([email protected]; @RhiannonHoyle)0642 GMT - An unexpected drop in Singapore's non-oil domestic exports in May signals the end of a short-lived export rebound, RHB Bank's group chief economist and head of market research Barnabas Gan writes in a note. The disappointing NODX print shows that the front-loading boost ahead of higher U.S. tariffs is fading rapidly, he says. Any further escalation in tariff risks would weigh on the city-state's manufacturing and export performance, he adds. This would put additional pressure on Singapore's overall economic growth. However, there could be upside potential for overall NODX performance if tariff risks gradually ease in 2H, he says. RHB maintains its flat forecast for Singapore's 2025 NODX, after factoring in May's data. ([email protected])0641 GMT - Long-term U.S. Treasury yields will remain heavily influenced by the budget deficit, Madison Investments' Mike Sanders says. The Federal Reserve will not surrender to the pressure to cut rates, the head of fixed income says. "As [Fed Chair Jerome] Powell has been consistent in saying we need to get spending in check, we don't expect the Fed to intervene to bring down longer-term rates absent a major fiscal policy blunder," Sanders says. Concerns over the deficit and debt in the U.S. have been on investors' radar for a long time. The 10-year Treasury yield falls 1.6 basis points to last trade at 4.437%, according to Tradeweb. The 30-year yield is down 0.4 bp but remains close to the critical 5% level, last trading at 4.950%. ([email protected])0633 GMT - China's national home sales and prices extended their softening trend in May, while construction and investment figures remained sluggish, Daiwa analyst William Wu writes in a note. Premier Li Qiang's pledge for stronger efforts to stabilize the property market may lift investor sentiment in the near term, Wu says. The nationwide residential property sales value fell by 6.1% on-year in May to CNY625 billion. Nationwide housing new starts declined further by 18.2% on-year in May, further exacerbating pressure on the pipeline for new launches. This may weigh on new home sales in 2H, Daiwa says. While the property market performance softened in 2Q, Premier Li Qiang pledged stronger efforts to ensure the sector stops declining at a State Council meeting last Friday, a positive sign. ([email protected]; @ivy_jiahuihuang)0629 GMT - The dollar edges higher as oil prices rise on news of new attacks in the Israel-Iran conflict, fuelling concerns over crude supply disruptions. The risk of an oil price spike due to Middle East tensions will likely keep the Federal Reserve in a cautious stance over interest-rate cuts at its two-day meeting starting Tuesday, Swissquote Bank analyst Ipek Ozkardeskaya says in a note. Higher oil prices are also positive for the dollar because the U.S. is one of the world's largest oil producers. The DXY dollar index rises 0.1% to 98.099. ([email protected])0615 GMT - Efforts to de-escalate tensions in the Middle East appear one-sided, says Ipek Ozkardeskaya, market strategist at Swissquote. While Iran appears to be signaling restraint, President Trump has urged the evacuation of Tehran and Israel has vowed to continue its strikes. This makes it a one-sided de-escalation at best, and keeps risks across energy markets and safe-haven assets tilted to the upside, she adds. Global energy supply remains fragile, and it wouldn't take much to shake the physical flow of oil and reverse market sentiment in a heartbeat, she says. ([email protected]; @JamesGlynnWSJ)0614 GMT - Two interest-rate cuts by the Federal Reserve in 2025 remains the most likely scenario for Madison Investments' Mike Sanders. "We don't anticipate significant changes to the updated Summary of Economic Projections (the 'dot plot')," the head of fixed income says. Any shift in the 2026 outlook, whether more or less aggressive, will offer insight into the Fed's interpretation of inflation and labor market trends going into 2H, Sanders says. He will listen closely to how Fed Chair Jerome Powell addresses the recent softer inflation data and whether the Fed attributes any of that to temporary factors, like inventory pre-buying ahead of tariffs. Sanders will also watch for any shift in the Fed's view of the cooling labor market. ([email protected])0612 GMT - The Taiwan dollar, Thai baht, and Korean won are most at risk from higher oil prices, Barclays' FICC Research team says. "Asian currencies generally weaken when oil prices rise due to an oil supply shock reflecting the negative economic hit and impact on current account balances," the team says. The recent rise in Brent oil price to the $70/bbl-$75/bbl range from around $65/bbl is "generally unhelpful for largely oil-importing Emerging Asia," the team says. Barclays' estimates suggest Thailand, Korea and Taiwan are the most exposed. USD/TWD edges 0.1% lower to 29.45; USD/THB is 0.2% higher to 32.51; USD/KRW rises 0.3% to 1,363.52. ([email protected])0604 GMT - U.S. Treasury yields decline in early European hours, reversing Monday's rise, as the conflict between Israel and Iran escalates. "Overnight risk sentiment has deteriorated following President Trump's call for an evacuation of Tehran," Danske Bank Research's August Hyldgaard says in a note. Besides geopolitics, drivers for U.S. Treasurys include U.S. retail sales and industrial production data. The two-year Treasury yield declines 1 bp to 3.957%, while the 10-year Treasury yield falls 1.5 bps to 4.439%, according to Tradeweb. ([email protected])0555 GMT - The Federal Reserve will continue to focus on economic data on Wednesday, keeping the Fed funds target rate range unchanged at 4.25%-4.50%, say DZ Bank analysts in a note. "In light of the robust economic data, a declining but still not convincingly low price pressure as well as potential inflation risks from tariffs, the Fed will continue to focus on the data," say Birgit Henseler and Christian Reicherter. With a wait-and-see stance, the Fed hopes to obtain more clarity about how President Trump's economic policy agenda impacts inflation and the labor market, they say. ([email protected])0550 GMT - The new U.K.-U.S. trade deal is "great news" for the U.K. automotive industry, according to British industry body the Society of Motor Manufacturers and Traders. The deal sees tariffs on car imports drop to10% from 25% for the first 100,000 cars into the U.S., confirming a pact initially agreed upon last month. SMMT Chief Executive Mike Hawes says the deal will help the sector avoid the severest level of tariffs, enabling many manufacturers to resume deliveries imminently. "We wait to see the full details of the deal and how it will be administered but this will be a huge reassurance to those that work in the sector and bolster the confidence of our important U.S. customers." ([email protected])