GLOBAL MARKET CALL: Getting Yin-Yanged By The Latest Gulf War

The re-escalation of the latest Gulf War pushed the price of Brent crude oil back up to $101.06 on Thursday. It was back down this evening as low as $86.58 after Iran reportedly said it would suspend attacks as long as the US does the same. Last week, rising oil prices were a headwind for the Go Global trade relative to Stay Home, because they fall harder on the oil-importing economies abroad than on the US, which exports oil. Hopefully, oil prices will be lower this week, providing a tailwind to Go Global. In any event, it seems that the plunge in China's June oil imports helps explain the rapid plunge in oil prices that month, when there was also a ceasefire (chart).

Global stock market leadership rotated sharply this month. The 2026 AI-related leaders, South Korea and Taiwan, are among the worst performers mtd, down 19.3% and 9.8% respectively (chart). China tops the leaderboard, up 9.5%, with Indonesia, Hong Kong, and Singapore close behind. Yet both Korea and Taiwan steadied this past week, up 0.3% and 0.7%, an early sign the sharp selloff is easing.