Stocks, gold, and silver are all coming under pressure again thanks to rising energy prices. Treasuries are mostly flat, while the dollar is dipping. Bitcoin is trading back below $80,000.
Crude oil continues to dominate market conversations, with WTI futures nearing the mid-$90s and Brent crude closing in on triple digits. This morning, Iranian-allied Houthi militants struck multiple energy industry targets in Saudi Arabia – reportedly including power, refining, and storage facilities. Over the weekend, the US also attacked three Iranian oil tankers after Iran targeted US warships with ballistic missiles.
US Brent Oil Fund (Red), US Oil Fund (Black) - YTD % Change
Source: TradingView
All told, the developments suggest the war will continue to drag on – putting upward pressure on inflation and energy prices. The average retail price of diesel at US pumps just hit an all-time high of $5.85 a gallon, according to AAA. That’s pressuring everyone from farmers to truckers, though it’s helping send refinery stocks through the roof.
Meanwhile, retaliatory Canadian tariffs of 15% to 50% just took effect on a wide range of US exports. Targeted products include steel items, motorcycles, and cheese. Prime Minister Mark Carney acted after President Trump hit $20 billion in Canadian exports with tariffs of up to 50% in August. The Canadian S&P/TSX Composite Index (^TSX:CA) is slightly outperforming the US S&P 500 Index (^SPX), up 14.5% versus 12.5% year-to-date.
Despite rising macroeconomic and geopolitical risks, Corporate America continues to spin off big profits. In fact, a Citigroup index that tracks analyst estimate changes has shown more estimate hikes than cuts for 21 straight weeks. That’s the longest upgrade stretch since September 2021. Estimates for 2027 profits at S&P 500 companies have climbed 4% in just the last two months.
