- US deploys B-1 bomber against Iran in biggest strike escalation yet
- Kospi jumps 3%, Nikkei rises as Google’s AI capex boost lifts chip stocks
- Australia jobs smash forecasts, keeping RBA’s August hike door (very slightly) open
- AUD/USD has jumped higher after the strong jobs report, biggest job gain in a year
- Australian June 2026 jobs report: Unemployment rate 4.4% (expected 4.4%, prior 4.4%)
- Oil hits six-week high as US strikes Iran, Houthis blockade Saudi ports
- PBOC sets USD/ CNY reference rate for today at 6.7906 (vs. estimate at 6.7712)
- Iran says tanker on fire, Strait of Hormuz
- US Trade Rep. Greer eyes interim US deals with Canada, Mexico by year end
- US surges forces to Middle East as Iran war options widen. Extra $73bln in funding for Iran war
- US military confirm they have begun a 12th consecutive night of strikes on Iran
- Billionaire investor Paulson: Gold’s rally has only begun, in early stages of long-term bull market
- UK military report yet another tanker has been struck, this time in the Red Sea
- Washington to expand nuclear technology exports to Saudi Arabia – US/Saudi nuclear deal
- investingLive Americas FX news wrap 22 Jul. Middle east tensions keep markets on edge. Oil higher.
- US stock indices give up their gains and close lower on the day
- Alphabet beats Q2 estimates as cloud revenue surges and Gemini usage grows
Summary:
- Brent crude rose more than $2 to hold near a six week high as US and Iran exchanged strikes for a 12th consecutive night
- Houthis say they struck Saudi tankers Layla and Encelia in the Red Sea, though UKMTO could only confirm one vessel hit
- Around 9 to 10 ships have stopped transiting Bab el-Mandeb following the Houthi blockade of Saudi ports
- Iran’s Revolutionary Guards say the Strait of Hormuz is fully closed and warn no tanker will pass without their coordination, threatening a total halt to oil flows if Iranian infrastructure is attacked
- Kuwait’s defense ministry says drones were intercepted over its airspace
- CENTCOM confirmed a 12th round of strikes on Iran, following Tuesday’s first B-1 bomber mission of this phase of the war
- Axios and WSJ report the US is surging special forces, jets and medics to the region, with an extra $73bln in war funding approved
- Gold slipped on the heightened Middle East risk
- USD softened modestly, with EUR, CAD, AUD and CHF firmer, while USD/JPY was little changed and Japan’s finance minister said Tokyo is ready to act decisively on FX if needed
- Kospi jumped over 3% and Nikkei rose around 1%, driven by Google’s raised AI capex guidance of $195bln to $205bln and strong Tesla earnings reinforcing the AI infrastructure spending story
- Australian employment rose 76.3k in June, far above the 15k forecast, with unemployment steady at 4.4% and yields initially higher
Middle East tensions dominated markets again, with Brent crude holding near a six week high as the US and Iran traded strikes for a 12th straight night. CENTCOM confirmed the latest round of attacks on Iranian military targets was ordered directly by President Trump, aimed at further degrading Iran’s ability to threaten commercial shipping, following Tuesday’s use of a B-1 long-range bomber, the first such mission since this phase of the conflict began 12 days ago. Reports from Axios and the Wall Street Journal added that Washington is surging special forces, jets and medics into the region alongside an extra $73bln in war funding, underscoring how quickly the conflict is escalating on the ground even as diplomatic channels through Qatar remain open.
The other major thread overnight was the widening threat to shipping. Iran’s Revolutionary Guards declared the Strait of Hormuz fully closed, warning no tanker will transit without their coordination and threatening to halt oil flows entirely if Iranian infrastructure comes under attack, a claim that followed reports of one tanker catching fire and two others turning back near the strait’s mined southern route. Simultaneously, the Houthis extended their own campaign into the Red Sea, claiming strikes on the Saudi tankers Layla and Encelia, though UKMTO said only one vessel had actually been hit. Around 9 to 10 ships have now abandoned plans to transit Bab el-Mandeb, and Kuwait reported intercepting drones over its own airspace, a sign the conflict’s shipping and airspace risks are spreading beyond the two original chokepoints. Gold’s pullback on the news marked a reversion to a more conventional risk reaction, even as the US dollar softened modestly against most peers.
That said, not every part of the market was in risk-off mode. Asian equities extended a sharp rally, with the Kospi up more than 3% and the Nikkei around 1% higher, as Google’s raised full year capex guidance of $195bln to $205bln, alongside strong Tesla earnings, reinforced the view that AI infrastructure spending remains firmly intact, a boon for chipmakers including SK Hynix and Samsung. Australia added its own data point to the mix, with June employment surging 76.3k against a 15k forecast. Taken together, markets are juggling a genuinely escalating Middle East conflict against a resilient AI driven equity rally, a combination likely to keep volatility elevated across oil, currencies and regional equities in the sessions ahead.
This article was written by Eamonn Sheridan at investinglive.com.
