Stocks are flirting with new highs this week, thanks to ebbing fears of a broader Middle East war. Trading has been muted so far this morning, though, with equities, gold, silver, and Treasuries all flattish. The dollar and crude oil are up a bit.
Reports on the amount of damage Iranian nuclear sites sustained are mixed. President Trump has declared them “completely destroyed,” while other reports suggest a more limited result. But from a market standpoint, what matters most is that the cease-fire appears to be holding.
Gold and crude oil surrendered the “war premium” built into their prices over the last couple of days, while the iShares QQQ Trust (QQQ) hit a record high (though just barely) yesterday. The S&P 500 Index (^SPX), for its part, entered today less than 1% below its record high from February.
QQQ, ^SPX, FDX (YTD % Change)
Data by YCharts
Still, the tariff countdown clock is ticking louder in the background. Trump’s 90-day negotiation deadline will expire on July 9, and investors haven’t heard much on the trade deal front lately. The European Union, Canada, and several Asian nations are working to find common ground with the US before “Liberation Day” tariffs replace the 10% baseline levies currently in place for most countries. Worth noting: China and the US have a separate timeline that runs through mid-August.
We’re in a relatively quiet period for corporate earnings, but FedEx Corp. (FDX) is one key exception. The global shipping giant warned that profit in the current quarter would miss targets, and it declined to offer up a full-year prediction amid trade-related economic uncertainty. FDX has more exposure to US-China trade than other logistics firms like United Parcel Service Inc. (UPS). FDX shares were already down more than 17% year-to-date, and they’re slipping further today.
