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Yahoo
35 minutes ago
- Yahoo
Stock market today: Dow, S&P 500, Nasdaq rise, oil tanks 7% after Iran's response to US strikes
US stocks rose on Monday while oil prices tanked following reports that Iran launched missiles at a US air base in Qatar in retaliation for US strikes against Iranian nuclear sites. The Dow Jones Industrial Average (^DJI) rose 0.6%. The S&P 500 (^GSPC) gained 0.7%, and the tech-heavy Nasdaq (^IXIC) rose around 0.9%. Oil prices fell as investors assessed the extent of Iran's retaliation. Brent crude (BZ=F) futures fell more than 7%, trading above $71 a barrel, while WTI crude futures (CL=F) hovered near $68. Iran said its retaliatory act matched the number of bombs the US dropped on its nuclear sites this weekend, in a move the Associated Press said signaled "a likely desire to deescalate." Qatar said the strike did not cause any casualties. That appeared to give a jolt to stocks, which started the session in red territory as oil surged on the immediate heels of President Trump's decision to join Israel's attacks on Iran on Saturday. Investors began the session on edge over a shock surge in energy prices if Iran blocks the key Strait of Hormuz waterway, as that would have repercussions for economies worldwide. Trump said late Saturday that the US had struck Iran's three main nuclear enrichment facilities, saying the sites had been "totally obliterated" — a claim that has since been questioned. He threatened Iran with more attacks if the country did not quickly seek peace talks. Elsewhere in markets, gold (GC=F) ticked higher, also switching course amid wavering haven demand. Stocks moved into positive territory earlier in the session after Federal Reserve governor Michelle Bowman expressed support for a rate cut "as soon" as July, becoming the second central bank policymaker to be that explicit in recent days about an easing of monetary policy in the near term. Oil extended declines to 7% on Monday following Iran's response to US bombings on Iranian nuclear sites, which appeared to spare the energy market. Brent crude (BZ=F), the international benchmark, fell more than 7% to slip below $72 per barrel. West Texas Intermediate (CL=F) also dropped to $68 per barrel. The declines came after Iranian state media said it launched missiles toward a US air base in Qatar. The retaliation against the US was seen as measured, given that traders feared a disruption to the oil market was possible. Meanwhile, US Energy Secretary Chris Wright seemed to downplay the possibility that Iran would close the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil flows. 'There is some risk of that, but I don't think the risk is huge,' Wright said during an interview with CNBC. Stocks are taking their cues from the oil market right now. Brent crude (BZ=F), the international benchmark, fell about 6% to slip below $72.50 a barrel. West Texas Intermediate (CL=F) futures also slid about 6% to fall about $70 off reports that Iran launched missiles toward US air bases in Qatar and Iraq in retaliation over US strikes against Iranian nuclear sites. The instant investor read through appeared to be positive since the retaliatory attacks didn't threaten the outlook for oil supply. Stocks rose as oil fell. The S&P 500 (^GSPC) added 0.7%, while the tech-heavy Nasdaq Composite (^IXIC) rose 0.8% and the Dow Jones Industrial Average (^DJI) about 0.7%, or just under 300 points. Oil prices fell on Monday after Iran's retaliatory moves following US strikes on the country's nuclear sites appeared to spare any supply of energy products. West Texas Intermediate fell 4%, while Brent crude also dropped more than 4% after Iranian state media said it launched missiles against US air bases in Qatar. Prior to the missile attacks, Wall Street weighed the possibility of an energy supply shock if Iran were to close the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil products flow. Yahoo Finance's Josh Schafer reports: Read more here. Google's artificial intelligence model is set to drive $4.2 billion in subscription revenue within its Google Cloud segment in 2025, according to an analysis from Bank of America on Monday. That includes $3.1 billion in revenue from subscribers to Google's AI plans with its Google One service, Bank of America's Justin Post estimates. Post also expects that the integration of Google's Gemini AI features within its Workspace service will drive $1.1 billion of the $7.7 billion in revenue he projects for that segment in 2025. 'We believe Google has moved beyond the catch-up phase in the LLM [large language model] race, with Gemini now comparing favorably with leading peer models from OpenAI, Anthropic, xAI, and Meta,' Post wrote, saying that AI is a 'major growth driver for Google Cloud.' But, Post added, 'While the revenue opportunity is growing with subscriptions, Google will likely see a significant deterioration of market share relative to its ~90% share of search revenues.' At the same time, Alphabet is set to spend $75 billion on AI investments in 2025. 'If revenue growth doesn't keep pace with rising Capex, higher spending could weigh on free cash flow and margin projections,' Post wrote. He holds a Buy rating and $200 price target on Alphabet (GOOGL, GOOG) shares. Yahoo Finance's Anjalee Khemlani reports: Read more here. Yahoo Finance's Claire Boston reports: Read more here. Yahoo Finance's Jennifer Schonberger reports: Read more here. President Trump called for lower energy prices as he posted on social media on Monday: "EVERYONE, KEEP OIL PRICES DOWN. I'M WATCHING! YOU'RE PLAYING RIGHT INTO THE HANDS OF THE ENEMY. DON'T DO IT!" He also wrote,"To The Department of Energy: DRILL, BABY, DRILL!!! And I mean NOW!!!" Oil futures fell more than 1% on Monday after spiking more than 5% on Sunday night as traders assessed whether Iran would close off the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil products flow. Strategy (MSTR) stock fell as much as 3% on Monday morning after the Michael Saylor-helmed firm announced another bitcoin purchase. The software firm turned crypto giant said in a filing with the US Securities and Exchange Commission that it bought $26 million worth of bitcoin between June 16 and June 22. As of Monday's filing, Strategy has spent nearly $42 billion to acquire over 592,000 bitcoins since 2020. Over that time frame, the stock has soared more than 2,800% relative to the S&P 500's 78% gain. Strategy shares pared initial losses shortly after the market opened and are down less than 1%. At the same time, Strategy is facing two new lawsuits from investors — one filed in May, the second last week — over its bitcoin strategy. The lawsuits allege that the company misled investors about how its bitcoin strategy would affect its profits and its stock price, given the cryptocurrency's volatility. Tesla stock (TSLA) rose 5% in early trading Monday after its robotaxi launch kicked off on Sunday in Austin, Texas. Yahoo Finance's Pras Subramanian reports that several users on X claimed they were able to hail and ride some of the 10-20 Tesla Model Y vehicles available, which featured "Robotaxi" graphics on the sides of the cars. Tesla CEO Elon Musk had announced the rollout on X earlier in the day, saying that customers will pay a flat $4.20 fee. Only select invited Tesla users were invited to test the robotaxi service, as it begins to scale to take on industry leader Waymo (GOOG, GOOGL). Wedbush analyst and Tesla bull Dan Ives wrote in a note: 'We took two approximately 15 minute rides around Austin and the key takeaways are that it was a comfortable, safe, and personalized experience.' Read more here. US stocks wavered on Monday as oil trimmed gains and supply worries eased over Iran's possible retaliatory move following US strikes on the country's nuclear facilities. The Dow Jones Industrial Average (^DJI) fell slightly while the S&P 500 (^GSPC) was little changed. The tech-heavy Nasdaq (^IXIC) fell slightly. OIl futures were little changed after spiking more than 5% on Sunday night as traders assessed whether Iran would close off the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil products flow. Trump Media & Technology (DJT) stock rose 4% before the market opened Monday morning after the company announced a $400 million stock buyback. Shares of the company — in which President Trump is the majority stakeholder — have fallen roughly 48% in 2025. Stock buybacks, a common practice that faces a fair share of criticism, reduce the amount of a company's common shares in the public market and, hence, boost its earnings per share even if its profits don't rise. Trump Media said the buybacks 'would be funded separately from, and would not alter, Trump Media's previously announced Bitcoin treasury strategy.' The company is aiming to create a bitcoin treasury to hold the cryptocurrency on its balance sheet and announced a $2.5 billion private funding round to fund the initiative in May. Trump Media is part of a wave of firms following in the footsteps of crypto tycoon Michael Saylor's company, Strategy (MSTR), which has seen its stock soar by buying up bitcoin. Wedbush analyst Dan Ives wrote in a note to clients on Monday that he expects cybersecurity stocks to be in focus following the US bombing of three Iranian nuclear facilities over the weekend. Ives wrote that 'cyber security stocks in particular [are] set to be front and center this week as investors anticipate some cyber attacks from Iran could be on the horizon as retaliation.' 'On the cyber security sector, our favorite names remain Palo Alto (PANW), Cyberark (CYBR), Crowdstrike (CRWD), Zscaler (ZS), and Checkpoint (CHKP)." The stocks traded roughly flat premarket on Monday. Defense stocks were modestly higher Monday during premarket trading after the US bombed three Iranian nuclear facilities over the weekend. Palantir (PLTR), Lockheed Martin (LMT), and Northrop Grumman (NOC) rose less than 1%, while RTX (RTX) climbed 1.3%. Palantir supplies AI-fueled defense tech to Israel, which has prompted blowback from former employees and protesters. The other three companies supply weapons to Israel through their contracts with the US government. The defense stocks had jumped immediately after Israel's first airstrikes on Iran on June 12, but only RTX has sustained notable gains of 4% since those strikes. Lockheed Martin is up 0.3% over that time frame, while Northrop Grumman is roughly flat (up 0.1%). Palantir has risen 1.6%. Jefferies (JEF) analyst Mohit Kumar wrote Monday, 'Market is now waiting to see how Iran reacts …However, we are not fully convinced around the market's sanguine reaction.' 'Defence has been one area that we have been bullish on, and we continue to maintain our overweight exposure,' he added. 'NATO countries have moved to increase defense spending with a long term goal of taking to 5% of GDP. We are typically skeptical of long term goals as goal posts do change, but it is also clear to us that defense spending needs to increase globally and not just for NATO countries.' Energy stocks rose alongside rising oil prices in premarket trading on Monday while overall stock futures wobbled. Those with oil production in the US and outside the Middle East caught a bid as investors weighed the possibility of further disruption to the oil supply following the US strikes on Iran. The Energy Select Sector SPDR Fund (XLE) advanced 0.6% and has risen 6% in the past month. Here's a look at how trending energy stocks are trading this morning: View more trending tickers here. Yahoo Finance's Jennifer Schonberger reports: Read more here. Economic data: Chicago Fed activity index (February); S&P Global US Manufacturing PMI (March preliminary); S&P Global US services PMI (March preliminary); S&P Global US Composite PMI (March preliminary) Earnings: FactSet (FDS), KB Home (KBH) Here are some of the biggest stories you may have missed overnight and early this morning: Trump just made the Fed's rate call even more complicated Opinion: Trump wages 2 wars — one with trade partners, one with Iran Why Iran could hold off blocking the Strait of Hormuz Oil erases spike in gains in wait for Iran's response Morgan Stanley: Geopolitical selloffs tend to fade fast Analysts react as markets brace for Iran's next move Dollar advances as investors brace for Iran response to US attacks BNY Mellon approached Northern Trust for merger: WSJ Here are some top stocks trending on Yahoo Finance in premarket trading: Tesla (TSLA) stock rose over 1% in premarket trading after rolling out its driverless taxi service to riders on Sunday. The debut of the robotaxi was introduced to a handful of riders, which included retail investors and social-media influencers in Tesla's hometown of Austin. Wolfspeed (WOLF) stock fell 11% in premarket trading on Monday after announcing it plans to file for bankruptcy in the US under a new restructuring agreement with its creditors. The agreement would provide fresh financing and slash debt by nearly 70%. Northern Trust Corporation (NTRS) shares rose 4% before the bell after a report from The Wall Street Journal said that Bank of New York Mellon Corp had reached out to the asset and wealth manager and expressed interest in a merger. Most investors will awaken today searching online for "Strait of Hormuz" after the weekend attacks from the US on Iran. For speed of analysis purposes, if this key oil shipping hub closes down (seems like it won't happen, based on everything I am seeing this morning), it could really send oil (CL=F, BZ=F) prices skyrocketing. Here's what Goldman's team estimates: "If oil flows through the Strait of Hormuz were to drop by 50% for one month and then were to remain down 10% for another 11 months, we estimate that Brent would briefly jump to a peak of around $110." Read more here on Goldman's scenarios. Oil extended declines to 7% on Monday following Iran's response to US bombings on Iranian nuclear sites, which appeared to spare the energy market. Brent crude (BZ=F), the international benchmark, fell more than 7% to slip below $72 per barrel. West Texas Intermediate (CL=F) also dropped to $68 per barrel. The declines came after Iranian state media said it launched missiles toward a US air base in Qatar. The retaliation against the US was seen as measured, given that traders feared a disruption to the oil market was possible. Meanwhile, US Energy Secretary Chris Wright seemed to downplay the possibility that Iran would close the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil flows. 'There is some risk of that, but I don't think the risk is huge,' Wright said during an interview with CNBC. Stocks are taking their cues from the oil market right now. Brent crude (BZ=F), the international benchmark, fell about 6% to slip below $72.50 a barrel. West Texas Intermediate (CL=F) futures also slid about 6% to fall about $70 off reports that Iran launched missiles toward US air bases in Qatar and Iraq in retaliation over US strikes against Iranian nuclear sites. The instant investor read through appeared to be positive since the retaliatory attacks didn't threaten the outlook for oil supply. Stocks rose as oil fell. The S&P 500 (^GSPC) added 0.7%, while the tech-heavy Nasdaq Composite (^IXIC) rose 0.8% and the Dow Jones Industrial Average (^DJI) about 0.7%, or just under 300 points. Oil prices fell on Monday after Iran's retaliatory moves following US strikes on the country's nuclear sites appeared to spare any supply of energy products. West Texas Intermediate fell 4%, while Brent crude also dropped more than 4% after Iranian state media said it launched missiles against US air bases in Qatar. Prior to the missile attacks, Wall Street weighed the possibility of an energy supply shock if Iran were to close the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil products flow. Yahoo Finance's Josh Schafer reports: Read more here. Google's artificial intelligence model is set to drive $4.2 billion in subscription revenue within its Google Cloud segment in 2025, according to an analysis from Bank of America on Monday. That includes $3.1 billion in revenue from subscribers to Google's AI plans with its Google One service, Bank of America's Justin Post estimates. Post also expects that the integration of Google's Gemini AI features within its Workspace service will drive $1.1 billion of the $7.7 billion in revenue he projects for that segment in 2025. 'We believe Google has moved beyond the catch-up phase in the LLM [large language model] race, with Gemini now comparing favorably with leading peer models from OpenAI, Anthropic, xAI, and Meta,' Post wrote, saying that AI is a 'major growth driver for Google Cloud.' But, Post added, 'While the revenue opportunity is growing with subscriptions, Google will likely see a significant deterioration of market share relative to its ~90% share of search revenues.' At the same time, Alphabet is set to spend $75 billion on AI investments in 2025. 'If revenue growth doesn't keep pace with rising Capex, higher spending could weigh on free cash flow and margin projections,' Post wrote. He holds a Buy rating and $200 price target on Alphabet (GOOGL, GOOG) shares. Yahoo Finance's Anjalee Khemlani reports: Read more here. Yahoo Finance's Claire Boston reports: Read more here. Yahoo Finance's Jennifer Schonberger reports: Read more here. President Trump called for lower energy prices as he posted on social media on Monday: "EVERYONE, KEEP OIL PRICES DOWN. I'M WATCHING! YOU'RE PLAYING RIGHT INTO THE HANDS OF THE ENEMY. DON'T DO IT!" He also wrote,"To The Department of Energy: DRILL, BABY, DRILL!!! And I mean NOW!!!" Oil futures fell more than 1% on Monday after spiking more than 5% on Sunday night as traders assessed whether Iran would close off the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil products flow. Strategy (MSTR) stock fell as much as 3% on Monday morning after the Michael Saylor-helmed firm announced another bitcoin purchase. The software firm turned crypto giant said in a filing with the US Securities and Exchange Commission that it bought $26 million worth of bitcoin between June 16 and June 22. As of Monday's filing, Strategy has spent nearly $42 billion to acquire over 592,000 bitcoins since 2020. Over that time frame, the stock has soared more than 2,800% relative to the S&P 500's 78% gain. Strategy shares pared initial losses shortly after the market opened and are down less than 1%. At the same time, Strategy is facing two new lawsuits from investors — one filed in May, the second last week — over its bitcoin strategy. The lawsuits allege that the company misled investors about how its bitcoin strategy would affect its profits and its stock price, given the cryptocurrency's volatility. Tesla stock (TSLA) rose 5% in early trading Monday after its robotaxi launch kicked off on Sunday in Austin, Texas. Yahoo Finance's Pras Subramanian reports that several users on X claimed they were able to hail and ride some of the 10-20 Tesla Model Y vehicles available, which featured "Robotaxi" graphics on the sides of the cars. Tesla CEO Elon Musk had announced the rollout on X earlier in the day, saying that customers will pay a flat $4.20 fee. Only select invited Tesla users were invited to test the robotaxi service, as it begins to scale to take on industry leader Waymo (GOOG, GOOGL). Wedbush analyst and Tesla bull Dan Ives wrote in a note: 'We took two approximately 15 minute rides around Austin and the key takeaways are that it was a comfortable, safe, and personalized experience.' Read more here. US stocks wavered on Monday as oil trimmed gains and supply worries eased over Iran's possible retaliatory move following US strikes on the country's nuclear facilities. The Dow Jones Industrial Average (^DJI) fell slightly while the S&P 500 (^GSPC) was little changed. The tech-heavy Nasdaq (^IXIC) fell slightly. OIl futures were little changed after spiking more than 5% on Sunday night as traders assessed whether Iran would close off the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world's oil products flow. Trump Media & Technology (DJT) stock rose 4% before the market opened Monday morning after the company announced a $400 million stock buyback. Shares of the company — in which President Trump is the majority stakeholder — have fallen roughly 48% in 2025. Stock buybacks, a common practice that faces a fair share of criticism, reduce the amount of a company's common shares in the public market and, hence, boost its earnings per share even if its profits don't rise. Trump Media said the buybacks 'would be funded separately from, and would not alter, Trump Media's previously announced Bitcoin treasury strategy.' The company is aiming to create a bitcoin treasury to hold the cryptocurrency on its balance sheet and announced a $2.5 billion private funding round to fund the initiative in May. Trump Media is part of a wave of firms following in the footsteps of crypto tycoon Michael Saylor's company, Strategy (MSTR), which has seen its stock soar by buying up bitcoin. Wedbush analyst Dan Ives wrote in a note to clients on Monday that he expects cybersecurity stocks to be in focus following the US bombing of three Iranian nuclear facilities over the weekend. Ives wrote that 'cyber security stocks in particular [are] set to be front and center this week as investors anticipate some cyber attacks from Iran could be on the horizon as retaliation.' 'On the cyber security sector, our favorite names remain Palo Alto (PANW), Cyberark (CYBR), Crowdstrike (CRWD), Zscaler (ZS), and Checkpoint (CHKP)." The stocks traded roughly flat premarket on Monday. Defense stocks were modestly higher Monday during premarket trading after the US bombed three Iranian nuclear facilities over the weekend. Palantir (PLTR), Lockheed Martin (LMT), and Northrop Grumman (NOC) rose less than 1%, while RTX (RTX) climbed 1.3%. Palantir supplies AI-fueled defense tech to Israel, which has prompted blowback from former employees and protesters. The other three companies supply weapons to Israel through their contracts with the US government. The defense stocks had jumped immediately after Israel's first airstrikes on Iran on June 12, but only RTX has sustained notable gains of 4% since those strikes. Lockheed Martin is up 0.3% over that time frame, while Northrop Grumman is roughly flat (up 0.1%). Palantir has risen 1.6%. Jefferies (JEF) analyst Mohit Kumar wrote Monday, 'Market is now waiting to see how Iran reacts …However, we are not fully convinced around the market's sanguine reaction.' 'Defence has been one area that we have been bullish on, and we continue to maintain our overweight exposure,' he added. 'NATO countries have moved to increase defense spending with a long term goal of taking to 5% of GDP. We are typically skeptical of long term goals as goal posts do change, but it is also clear to us that defense spending needs to increase globally and not just for NATO countries.' Energy stocks rose alongside rising oil prices in premarket trading on Monday while overall stock futures wobbled. Those with oil production in the US and outside the Middle East caught a bid as investors weighed the possibility of further disruption to the oil supply following the US strikes on Iran. The Energy Select Sector SPDR Fund (XLE) advanced 0.6% and has risen 6% in the past month. Here's a look at how trending energy stocks are trading this morning: View more trending tickers here. Yahoo Finance's Jennifer Schonberger reports: Read more here. Economic data: Chicago Fed activity index (February); S&P Global US Manufacturing PMI (March preliminary); S&P Global US services PMI (March preliminary); S&P Global US Composite PMI (March preliminary) Earnings: FactSet (FDS), KB Home (KBH) Here are some of the biggest stories you may have missed overnight and early this morning: Trump just made the Fed's rate call even more complicated Opinion: Trump wages 2 wars — one with trade partners, one with Iran Why Iran could hold off blocking the Strait of Hormuz Oil erases spike in gains in wait for Iran's response Morgan Stanley: Geopolitical selloffs tend to fade fast Analysts react as markets brace for Iran's next move Dollar advances as investors brace for Iran response to US attacks BNY Mellon approached Northern Trust for merger: WSJ Here are some top stocks trending on Yahoo Finance in premarket trading: Tesla (TSLA) stock rose over 1% in premarket trading after rolling out its driverless taxi service to riders on Sunday. The debut of the robotaxi was introduced to a handful of riders, which included retail investors and social-media influencers in Tesla's hometown of Austin. Wolfspeed (WOLF) stock fell 11% in premarket trading on Monday after announcing it plans to file for bankruptcy in the US under a new restructuring agreement with its creditors. The agreement would provide fresh financing and slash debt by nearly 70%. Northern Trust Corporation (NTRS) shares rose 4% before the bell after a report from The Wall Street Journal said that Bank of New York Mellon Corp had reached out to the asset and wealth manager and expressed interest in a merger. Most investors will awaken today searching online for "Strait of Hormuz" after the weekend attacks from the US on Iran. For speed of analysis purposes, if this key oil shipping hub closes down (seems like it won't happen, based on everything I am seeing this morning), it could really send oil (CL=F, BZ=F) prices skyrocketing. Here's what Goldman's team estimates: "If oil flows through the Strait of Hormuz were to drop by 50% for one month and then were to remain down 10% for another 11 months, we estimate that Brent would briefly jump to a peak of around $110." Read more here on Goldman's scenarios. Sign in to access your portfolio
Yahoo
an hour ago
- Yahoo
Fed officials are starting to break rank and join Trump
Some Federal Reserve officials are joining President Donald Trump in calling for lower interest rates as soon as July. Fed Vice Chair for Supervision Michelle Bowman on Monday downplayed the potential impacts of Trump's tariffs on prices and said the US central bank should swiftly lower rates to preserve the labor market's health. 'It is time to consider adjusting the policy rate,' Bowman said. 'Should inflation pressures remain contained, I would support lowering the policy rate as soon as our next meeting in order to bring it closer to its neutral setting and to sustain a healthy labor market.' Bowman is the second Fed official to join Trump in calling for lower borrowing costs. On Friday, Fed Governor Christopher Waller said tariffs will likely only result in a 'one-off' increase in inflation. Both Bowman and Waller are Trump appointees. For months, Fed officials have said they prefer to wait to see how Trump's major policy shifts affect the US economy first before considering further rate cuts. At its policy meeting earlier this month, the Fed kept its benchmark lending rate unchanged for the fourth consecutive time. But that strategy hasn't sat well with Trump, who has relentlessly lashed out at the central bank and its leader, Fed Chair Jerome Powell, for not lowering rates. Trump has hurled various insults at Powell, describing him as a 'fool' and a 'numbskull.' Now, the Fed's wait-and-see posture is slowly crumbling, even as tensions in the Middle East heat up, which raises the risk of higher global energy prices. And the jury is still out on the ultimate impact of Trump's tariffs. Bowman said it's possible the Israel-Iran conflict — which escalated over the weekend with the US striking at three Iranian nuclear sites — results in higher commodity prices. And there's still the lingering possibility of Trump's trade war also pushing up prices, she said. Still, that may not even result in higher consumer prices because businesses don't have much leverage to hike prices this time around, Bowman said. 'I am certainly attentive to these inflation risks, but I am not yet seeing a major concern, as some retailers seem unwilling to raise prices for essentials due to high price sensitivity among low-income consumers and as supply chains appear to be largely unaffected so far,' Bowman said. Bowman isn't the only Fed official seemingly not worried about the potential economic impact of the Israel-Iran conflict. Powell has said higher energy prices spurred by the conflict will likely be short lived. 'When there's turmoil in the Middle East, you may see a spike in energy prices, but it tends to come down. Those things don't generally tend to have lasting effects on inflation, although of course in the 1970s, they famously did,' Powell said in a news conference following the Fed's June 17-18 policy meeting. 'But, we haven't seen anything like that now. The U.S. economy is far less dependent on foreign oil than it was back in the 1970s,' he added. Economists have said the economic impact of the current conflict largely depends on how out of hand it gets. A forecast from analysts at EY-Parthenon shows that the US economy could contract by a massive 1.9% annualized rate if the Middle East plunges into an all-out regional war. But in a 'contained' scenario, the US economy could contract only slightly. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Gold ETFs Shine in 1H: Will the Bloom Continue in 2H?
Gold has been on a powerful upward trajectory this year, fueled by strong safe-haven demand amid Trump's tariff chaos and escalating geopolitical tensions, weakening U.S. dollar and growing expectations of Federal Reserve rate cuts. The yellow metal has posted monthly gains for five straight months as of May, its longest run since 2017. It hit a new all-time high of $3,500 in April and then retreated from this level. Gold has moved up 27% since the start of the to a report by Axis Securities, gold is on track to reach a milestone with a six-month winning streak not seen in over two decades (read: Gold Up 27% YTD: How Long Will the Rally Last?).Given the surge in gold prices, gold mining ETFs are blooming in the first half, with many analysts expecting further gains in the second half. The mining companies act as leveraged plays on the underlying metal prices and, thus, tend to experience more gains than their bullion cousins in a rising metal Gold Miners ETF SGDM is leading the pack, jumping 65% since the start of the year, followed by gains of 63.7% for Themes Gold Miners ETF AUMI, 61% for VanEck Junior Gold Miners ETF GDXJ, 59.7% for Global X Gold Explorers ETF GOEX, and 58.8% for iShares MSCI Global Gold Miners ETF have highlighted several reasons for the solid rally in gold and its outlook: President Donald Trump's set of tariffs has lured investors to shift to defensive investments. Gold is often used to preserve wealth during financial and political uncertainty and usually does well when other asset classes struggle. Additionally, the inflationary pressure caused by new tariffs will benefit the precious metal's status as a hedge against rising prices. A weaker dollar and sustained central bank buying also buoyed gold's rally this year. The central banks are dominant buyers of gold as they seek to diversify their reserves away from the U.S. dollar. According to a recent survey conducted by the World Gold Council, about 95% of central banks believe their gold reserves will increase over the next 12 months. Though the Fed has kept interest rates steady at the latest meeting, an imminent rate cut can be in the cards in the next couple of months. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, increasing its attractiveness over fixed-income investments such as now forecast gold to trade between $3,500 and $3,700 as investors seek refuge from escalating geopolitical tensions and rising inflation risks. Goldman Sachs reiterated its bullish long-term view on gold, highlighting strong central bank demand. Goldman forecasts gold to reach $3,700 by the end of 2025 and $4,000 by mid-2026. In a recession scenario, accelerating ETF inflows can lift gold to $3,880 by year-end. Year to date, the two largest gold ETFs — SPDR Gold Shares GLD and iShares Gold Trust IAU — have attracted more than $11 billion in combined inflows, according to SPDR Gold Shares alone has taken in nearly $7 billion, ranking it No. 13 among all ETFs by asset flows (read: Why Gold ETFs Offer the Best Safe Haven Right Now). Let us delve into each ETF below:Sprott Gold Miners ETF (SGDM)Sprott Gold Miners ETF follows the Solactive Gold Miners Custom Factors Index, which aims to track the performance of larger-sized gold companies whose stocks are listed on Canadian and major U.S. exchanges. It holds 37 stocks in its basket. Canada takes the top spot at 75.2%, followed by 17.6% in the United States. Sprott Gold Miners ETF has amassed $418.6 million in its asset base and trades in a lower volume of around 42,000 shares a day. It charges 50 bps in annual fees from investors. Themes Gold Miners ETF (AUMI)Themes Gold Miners ETF seeks to track the Solactive Global Pure Gold Miners Index, which identifies the largest 30 companies by market capitalization, deriving their revenues from gold mining. It holds 28 stocks in its basket, with Canadian firms accounting for 58.6% of the portfolio, followed by Australian firms with a 27.5% share. Themes Gold Miners ETF has accumulated $10.4 million in its asset base. It charges 35 bps in fees per year and trades in a lower average daily volume of 7,000 Junior Gold Miners ETF (GDXJ) VanEck Junior Gold Miners ETF offers exposure to small-capitalization companies that are involved primarily in the mining of gold and/or silver and tracks the MVIS Global Junior Gold Miners Index. Holding 92 stocks in its basket, Canadian firms dominate the fund's portfolio with a 47.8% share, whereas Australia (20.4%) and South Africa (6.4%) round out the top three. VanEck Junior Gold Miners ETF has an AUM of $5.7 billion and charges 51 bps in annual fees. It trades in a heavy volume of around 5 million shares a day on X Gold Explorers ETF (GOEX) Global X Gold Explorers ETF provides exposure to companies involved in the exploration of gold deposits and tracks the Solactive Global Gold Explorers & Developers Total Return Index. It is home to 51 stocks. Canadian firms dominate the fund's return at 54.1%, followed by Australia (27.6%) and the United States (8.8%). Global X Gold Explorers ETF is unpopular and illiquid, with an AUM of $66.5 million and an average daily volume of 17,000 shares. The expense ratio comes in at 0.65% (read: Should You Buy Gold or Gold Miners Now?).iShares MSCI Global Gold Miners ETF (RING) iShares MSCI Global Gold Miners ETF offers exposure to companies that derive the majority of their revenues from gold mining. It follows the MSCI ACWI Select Gold Miners Investable Market Index and holds 42 securities in its portfolio. Canadian firms take more than half of the portfolio, while the United States takes the next spot at 17.2% share. RING is the cheapest choice in the gold mining space, charging just 39 bps in fees and expenses. iShares MSCI Global Gold Miners ETF has been able to manage assets worth $1.5 billion and trades in a good volume of 275,000 shares per day. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR Gold Shares (GLD): ETF Research Reports iShares Gold Trust (IAU): ETF Research Reports VanEck Junior Gold Miners ETF (GDXJ): ETF Research Reports iShares MSCI Global Gold Miners ETF (RING): ETF Research Reports Sprott Gold Miners ETF (SGDM): ETF Research Reports Global X Gold Explorers ETF (GOEX): ETF Research Reports Themes Gold Miners ETF (AUMI): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research
