Trump Moves That Shook Markets This Week

Trump Moves That Shook Markets This Week frames three policy shocks between July 6 and July 11 that pushed energy, rates, and European equities. First, Donald Trump declared the Iran ceasefire over after renewed attacks on commercial ships and U.S. facilities in the Gulf, triggering strikes on Iranian targets and lifting Brent by 5.2% and WTI by 4.4% to a two-week high. Equity indexes closed lower, with the S&P 500 and Dow down and the STOXX 600 recording its steepest decline since March. The oil rally also raised Treasury yields as investors priced more inflation risk, complicating the Federal Reserve’s path toward rate cuts. Second, Trump ordered a halt to trade and visits with Spain, citing insufficient defense spending and obstruction in the U.S. campaign against Iran; Spain’s IBEX 35 fell 2.6% with drops including Santander (-4.3%), BBVA (-3%), and Inditex (-3.6%). Spain’s 10-year bond yield rose nine basis points. Third, Trump backed tougher Russia sanctions and authorized Ukraine to manufacture Patriot air-defense systems, while senators advanced sanctions legislation targeting countries still buying Russian oil and gas.