June 24 Financial Breakfast: Iran accepts ceasefire proposal after "revenge" on the United States, international oil prices flash crash, the US dollar falls, and US stocks rise across the board

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In the early hours of Tuesday (June 24), Iran launched missile attacks on U.S. military bases located in Qatar and Iraq, but notified in advance before the attack, showing great restraint in its retaliatory actions. After Iran's "revenge" actions, U.S. President Donald Trump expressed gratitude for Iran's prior notification of the strikes on U.S. military bases and announced that Israel and Iran had agreed to a comprehensive ceasefire, which was confirmed by Iranian officials. As the situation in the Middle East rapidly cooled, WTI crude oil plummeted nearly 18% from a high of $78.4 on Monday (June 23), breaking through the $65 level.

All three major U.S. stock indices rose, with the Dow Jones up 0.89%; the S&P 500 rebounded 0.96%, returning above 6000 points; the Nasdaq rose 0.94%; and the China Golden Dragon Index rebounded 0.85%. In terms of popular stocks, most large tech stocks rose, with Meta up over 2%. The leading stablecoin company Circle surged over 9%, with a cumulative increase of about 750% since its listing. Tesla soared over 8%, marking its largest single-day gain since April 28, as it launched its autonomous vehicle (Robotaxi) in Austin, Texas.

The U.S. dollar index fell 0.43%, breaking through 99.0 to 98.34, while the yield on the 10-year U.S. Treasury bond briefly fell below 4.3%, reaching a one-and-a-half-month low. The USD/JPY retraced all gains for the week, falling below 146.0, while the EUR/USD rose 0.49%, returning above 1.1600; gold fell 0.13%, dropping below $3360, and WTI crude oil fell 9.2%, breaking through the $70 mark; Bitcoin regained the $100,000 mark, returning above $105,000, while Ethereum returned above $2400.

Macro News

Middle East situation rapidly cools, Iran accepts ceasefire proposal after "revenge" against the U.S.

Iran launched missile attacks on U.S. military bases located in Qatar and Iraq, firing 14 missiles, which is equivalent to the number of GBU-57 massive bunker busters dropped by the U.S. on Iranian nuclear facilities last weekend. The attacks were notified in advance, resulting in no injuries and almost no damage, demonstrating great restraint in its retaliatory actions.

After Iran's "revenge" actions, U.S. President Donald Trump expressed gratitude for Iran's prior notification of the strikes on U.S. military bases and announced that Israel and Iran had agreed to a comprehensive ceasefire. Trump stated that the ceasefire would begin approximately six hours later, at midnight Eastern Time on the 24th. The ceasefire agreement involves two 12-hour ceasefire periods, with Iran initiating the first 12-hour ceasefire, followed by Israel conducting the second 12-hour ceasefire, and after 24 hours, the war will officially be declared over.

According to Reuters, a senior Iranian official confirmed to Reuters that Iran has accepted Qatar's involvement in mediating the ceasefire proposal put forth by the U.S. regarding Israel. On the other hand, reports indicate that Israeli Prime Minister Benjamin Netanyahu requested ministers not to comment on the recent developments, namely "Trump's announcement of a comprehensive ceasefire agreement with Iran," until further noticeAccording to AXIOS reports, the ceasefire agreement between Iran and Israel was reached through mediation in Qatar and the United States. After Iran retaliated against the U.S. airbase in Qatar, Iran sent a message to the White House through Qatar, stating that it would not launch any further attacks. The White House also issued a statement emphasizing that it would not retaliate against Iran's attacks and indicated that the U.S. was ready to resume negotiations with Iran. Subsequently, the U.S., Israel, Qatar, and Iran continued negotiations and reached an agreement on the ceasefire terms and start time.

Trump urges all parties to lower oil prices

U.S. President Trump wants oil prices to remain low, as he is concerned that the consequences of an attack on Iran's nuclear facilities could lead to a spike in oil prices. Trump wrote in capital letters on the social platform Truth Social: "Everyone, keep the oil prices down, I'm watching! You are helping the enemy, don't do this."

He later posted a message to the U.S. Department of Energy, urging it to increase oil production and emphasizing, "I mean do it now."

U.S. Secretary of Energy Chris Wright responded in a post on the social platform X: "We are working hard." It is currently unclear what measures the Department of Energy will take to promote oil and gas exploration activities. During former President Biden's administration, oil and gas exploration activities reached a historic high, and Trump hopes to further elevate this level. The Department of Energy has not immediately responded to inquiries regarding Wright's comments.

Federal Reserve officials release dovish signals, indicating a possible rate cut as early as July

U.S. Federal Reserve Governor Michelle Bowman expressed her support for another governor, Christopher Waller, who earlier suggested a possible rate cut as early as July. Bowman stated that recent inflation has fallen below expectations, reflecting that trade policies have only had a slight impact on the core Personal Consumption Expenditures (PCE) data, which the Federal Reserve considers an inflation indicator. Meanwhile, the short-term risks to U.S. employment may become more severe.

Chicago Federal Reserve Bank President Austan Goolsbee stated that the economic impact of Trump's tariff measures has not been as significant as expected. If inflation does not rise as anticipated, this may allow the Federal Reserve to consider cutting rates again. He believes the economy has not deviated from the "golden path" he emphasized until April 2.

U.S. June Markit Manufacturing and Services continue to expand, with the price index recording the largest increase in four years

S&P Global announced that the preliminary value of the U.S. Manufacturing Purchasing Managers' Index (PMI) for June remained at 52.0, the highest since February 2023, exceeding market expectations of 51.0. This indicates that the manufacturing sector continues to expand, with increased hiring due to inventory building and a recovery in domestic demand, leading to the highest factory employment growth in a year. The manufacturing materials purchasing price index surged by 5.4 points to 70, marking the largest increase in four years.

S&P Global Chief Economist Chris Williamson pointed out that despite a decline in export demand, the strengthening of domestic demand has prompted businesses to increase capacity allocation. However, he also warned that recent expansions and inventory replenishments are primarily influenced by inflation expectations and tariffs, and this momentum may fade in the coming monthsS&P Global announced that the preliminary value of the U.S. Services Purchasing Managers' Index (PMI) for June is 53.1, with market expectations at 53 and a previous value of 53.7.

Lagarde: The European Central Bank is capable of addressing exceptionally severe economic and political uncertainties

European Central Bank President Christine Lagarde stated that the ECB is capable of addressing "exceptionally severe" economic and political uncertainties. In a speech to the European Parliament in Brussels, Lagarde said that the inflation rate will stabilize around the 2% target, and the risks to economic growth remain tilted to the downside.

She noted, "At the current level of interest rates, we believe we can respond well to the uncertain environment, especially under the current exceptionally uncertain circumstances, we will adopt a data-dependent and meeting-by-meeting approach to determine the appropriate monetary policy stance."

Lagarde reiterated that the digital euro is key to Europe's financial autonomy and pointed to competing privately issued digital currencies, namely stablecoins, urging for the swift establishment of a legislative framework to pave the way for the launch of the digital euro.

Market Overview

U.S. Stocks: All three major U.S. stock indices rose, with the Dow Jones up 0.89%, the S&P 500 up 0.96%, and the Nasdaq up 0.94%.

European Stocks: European stock markets fell across the board, with the German DAX 30 index down 0.35%. The French CAC 40 index fell 0.69%. The UK FTSE 100 index decreased by 0.19%.

Bond Market: The yield on the U.S. 10-year benchmark treasury bond is approximately 4.34%, down 3 basis points from the previous trading day.

Commodities: Gold fell 0.13%, priced at $3,367 per ounce. WTI crude oil dropped 9.2%, priced at $67.2 per barrel.

Foreign Exchange: The U.S. dollar index fell 0.43%, priced at 98.3. The USD/JPY rose 0.04%, and the EUR/USD increased by 0.49%.

Cryptocurrency: Bitcoin rose 4.4% in the last 24 hours, currently priced at $105,386. Ethereum increased by 8.28% in the last 24 hours, currently priced at $2,413.

Hong Kong Stocks: The Hang Seng Index night market futures closed at 23,721 points, up 63 points, compared to the previous day's closing of 23,689 points, with a premium of 32 points and a turnover of 16,522 contracts. The National Index night market futures closed at 8,604 points, with a premium of 7 points compared to the previous day's closing.

Global Company News

General Dynamics receives an additional $621 million U.S. Army contract

General Dynamics has signed a contract with the U.S. Army for an additional $621 million. The U.S. Army stated on Monday that the funds will be used for General Dynamics Land Systems' work on the SGT Stout system and services in Sterling Heights, Michigan. The expected completion date is September 29, 2028. This modification is an addition to a $1.22 billion contract from 2020.

All Robotax players are racing to commercialize, while autonomous driving still requires multi-faceted efforts to break throughOn June 22, local time, Tesla launched its Robotaxi pilot operation service in Austin, Texas, USA, with the first batch of 10 Model Y vehicles used for Robotaxi services, where passengers are required to pay a fixed fee of $4.20. This indicates that Tesla's technology route of vision + end-to-end model is gradually being validated, and it also means that the commercialization process of Robotaxi is further accelerating. Currently, global Robotaxi is gradually moving from technology validation to the commercial pilot operation stage. Experts interviewed stated that the development of Robotaxi still requires collaboration among regulatory authorities, automakers, intelligent driving technology companies, and mobility service operators to gradually overcome multiple challenges in technology, cost, ecology, and policy. Relevant departments need to provide an open and inclusive policy environment for enterprises and accelerate the legislation for autonomous driving.

Novo Nordisk's Ozempic recommended by the EU for treating arterial disease

Novo Nordisk announced on Monday that the European Commission has recommended the use of its type 2 diabetes and weight loss drug Ozempic for peripheral artery disease (PAD) and its main treatment issues. The company stated that it expects the European Commission to update the drug's label in about two months.

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