Asia open: US stock futures retreated ahead of Juneteenth holiday, US dollar remains firm

• The reopening of the Strait of Hormuz has accelerated the unwinding of the geopolitical risk premium. Crude oil has fallen sharply, with WTI posting a 10% weekly decline as Gulf oil exports resume and supply concerns ease, supporting global risk sentiment and reducing near-term inflation pressures.
• The US dollar remains the dominant beneficiary of the Fed’s hawkish pivot. Following Chair Kevin Warsh’s shift toward a data-dependent, higher-for-longer policy framework, the US Dollar Index broke above a major resistance level, while the euro, pound, gold, and other rate-sensitive assets remained under pressure.
• Global equities are entering a consolidation phase despite improved geopolitical conditions. Wall Street rallied strongly on optimism over a peace deal, but profit-taking emerged in US futures and parts of Asia as traders navigate reduced liquidity ahead of the Juneteenth holiday and reassess the implications of restrictive monetary policy.
• Chart of the day: WTI crude has established a near-term floor at the 200-day moving average. Watch the $75.25/73.40/bbl key near-term support for a potential short-term rebound.

The 10% plunge in the price action of the West Texas Oil CFD (a proxy for WTI crude oil futures) since the start of this week has reached an inflexion point for a potential near-term rebound.

The decline has begun to stall at the key 200-day moving average, which price has traded above since early February 2026, before the start of the US-Iran war. In addition, the hourly RS momentum has flashed a bullish divergence in its oversold region, suggesting that bearish momentum is starting to wane (see Fig. 1).

Watch the 75.25/73.40 key short-term pivotal support for a potential short-term rebound scenario to unfold towards the next intermediate resistances at 80.75 and 82.98/84.94 (gap down area of Monday, 15 June 2026).

On the other hand, a break and an hourly close below 73.40 would invalidate the short-term bullish scenario, extending the bearish impulsive down-move sequence to expose the next support levels at 70.25 and 67.40/66.10.

• Strait of Hormuz reopens as U.S.-Iran peace deal takes effect: The historic U.S.-Iran peace agreement officially went into effect over the past 24 hours, bringing a definitive end to the highly disruptive maritime blockade. Shipping tracking data confirmed that tankers holding nearly 10 million barrels of crude are actively moving through the critical chokepoint, including the first Saudi-owned vessels since the conflict began. In tandem, Kuwait announced plans to swiftly ramp up crude production back toward 2 million barrels per day within the week, severely deflating the geopolitical risk premium.
• Wall Street stages massive 2.5% relief rally ahead of Juneteenth holiday: U.S. stock benchmarks surged on Thursday as geopolitical de-escalation sparked aggressive risk-on buying. The Nasdaq 100 led the charge, soaring 2.5% on secular tech tailwinds and mega-cap momentum. The S&P 500 advanced 1.1% to cap off trading before Friday’s full market closure in observance of the Juneteenth national holiday. In contrast, SpaceX tumbled for the second consecutive session, losing 3.6%, and ended Thursday at $185.00, still above last Friday’s debut closing price of $160.95.
• Crude oil suffers severe liquidation, crashing 10% for the week: Energy markets experienced a massive unwinding of long positions as supply anxieties evaporated. West Texas Intermediate (WTI) crude plunged below $75 before stabilising at $76.83/bbl, marking its lowest level since the earliest days of the Middle East conflict. Brent crude similarly succumbed to selling pressure, settling firmly under the key $80 threshold at $79.25/bbl as global supply channels normalised.
• Longer-term U.S. Treasury yields remained below last week’s highs: The benchmark 10-year US Treasury yield dropped by 3 basis points to settle at 4.45%. However, the short end of the curve remains highly inverted and elevated following the surprise “hawkish vibes” from newly appointed Fed Chair Kevin Warsh and the updated dot plot, keeping fixed-income participants structurally on edge. The 2-year US Treasury yield remained steady at 4.18% as it retested its 4-week range top.
• Gold dropped lower to $4,209 on the backdrop of a hawkish Fed: Spot gold prices fell 1.1% to settle near $4,209 an ounce. The precious metal faced a dual headwind from an appreciating U.S. dollar, buoyed by the Fed’s higher-for-longer baseline, and a sharp reduction in safe-haven demand as shipping corridors across the Middle East successfully reopened.

• The reopening of the Strait of Hormuz and unwinding of the war premium: The formal implementation of the U.S.-Iran accord has triggered a rapid recalibration of global commodity supply curves. Front-month energy contracts had spent months pricing in a worst-case structural blockade scenario. With tracking data showing immediate, real-time flows of millions of barrels of crude out of the Gulf, the speculative war premium has completely dissolved. This influx of near-term physical supply shifts the energy narrative from structural deficits back to a projected supply expansion heading into the latter half of the year.
• Post-Fed yield Curve flattening under the “Warsh Era”: While the broader market celebrated geopolitical breakthroughs, fixed-income horizons continue to digest the monumental communication shift introduced by Fed Chair Kevin Warsh. By eradicating forward guidance and elevating the 2026 core PCE forecast to 3.3%, the Fed has locked in a highly restrictive near-term floor. Thursday’s bond activity reflected a pronounced flattening of the yield curve; long-end yields dipped on peace headlines, but short-term instruments (2-year US Treasury yield) remain rigidly anchored to the reality that rate cuts have been eradicated.
• Holiday liquidity drain and shifting global sessions: With U.S. cash equity and Treasury markets entirely closed today, Friday, June 19, for the Juneteenth holiday, global liquidity is experiencing an abrupt structural drop. Settlement cycles are paused, leaving international sessions in Europe and Asia to digest the massive macro shifts of the past 24 hours without the buffer of Wall Street’s active order book.

Equities: The Nasdaq 100 rallied 2.5% to lead the session, driven by outperformance among mega-cap tech stocks. The S&P 500 gained 1.1% to close out the pre-holiday week on a positive note. Small caps followed the risk-on move, with the Russell 2000 closing up 2.1%, reversing a multi-session downward trend.

However, in today’s Asia opening session, the E-mini futures on the S&P 500 and Nasdaq 100 declined by 0.5% and 0.7% as US Vice President JP Vance delays trip for Iran talks as the 60-day countdown starts to reach a nuclear agreement and a permanent US-Iran peace deal.

Fixed Income: Sovereign bonds stabilised as long-term inflation risk premiums eased with lower oil prices. The 10-year U.S. Treasury yield fell 3 basis points to 4.45% but remains above its 50-day moving average at around 4.40%. Conversely, short-term yields hovered near multi-decade highs, locking the curve in a deep inversion following the FOMC’s hawkish dot plot shift.

FX: The U.S. Dollar Index remained firmly supported near recent highs, underpinned by the Fed’s upgraded economic projections, and broke above the 100.55 major range resistance level, which had been in place since May 2025.

The euro and the British pound extended their losses by 0.4% and 0.7%, respectively, for the second consecutive session on Thursday, trading at 3-month lows of 1.1458 and 1.3205 against the greenback.

Commodities: WTI crude plummeted below $74 before recovering slightly to settle near $75.50/bbl, holding right at the key 200-day moving average after a steep 10% decline on the week. Brent crude followed suit, closing under $80.00 at US$79.25/bbl on Thursday. Spot gold slid 1.4 % to close at $4,209 and extended its losses by 1.4% in today’s Asian session to hover close to the 11 June 2026 low of $4,024/oz.

• Profit-taking activities in South Korean stocks after Thursday’s rally towards record highs on semi-tailwinds: KOSPI dropped by 1.2 on Friday, in line with intraday weakness seen in Nasdaq 100 E-mini futures, but the South Korean benchmark index is still up 10% for the week.
• Yen remains wrapped in extreme intervention territory: The Japanese yen weakened towards the 161 handle, hitting an almost 2-year low of 161.81 on Thursday, just a whisker away from 161.95 per US dollar, which was printed on 10 July 2024 and triggered intervention by Japanese authorities. Wide interest-rate differentials, driven by Fed Chair Warsh’s hawkish policy stance, ensure that the Bank of Japan and the Ministry of Finance remain on high alert for immediate spot-market smoothing.
• Australian markets dragged down by BHP operational pressures: Defying the broader regional rally, Australia’s ASX 200 opened in negative territory on Friday (-1.1%). The index was dragged down by a sharp 4% drop in BHP shares following unexpected operational constraints at one of its major Canadian production facilities, offsetting regional macro optimism.

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