Deutsche Bank: Markets Caught Between Falling Oil and Renewed AI Weakness Ahead of Midterms
Markets enter the US midterms with competing signals from energy and technology. Brent fell sharply as hopes for progress in the US-Iran conflict improved, with Iran’s Supreme Leader granting the government authority to pursue peace talks, Trump downplaying the prospect of renewed strikes and Vice President Vance expressing optimism over a potential agreement. Lower oil prices eased inflation concerns and supported Treasuries and European sovereign bonds. However, the improvement in risk sentiment was offset by renewed weakness in technology, pushing the Nasdaq 100 into technical correction territory even as broader equities proved more resilient. The midterms are the main focus, with implications for Trump’s legislative agenda, fiscal policy and appointments, while attention later in the week turns to payrolls and other labour-market and activity data.
Markets enter the US midterms with competing signals from energy and technology. Brent fell sharply as hopes for progress in the US-Iran conflict improved, with Iran’s Supreme Leader granting the government authority to pursue peace talks, Trump downplaying the prospect of renewed strikes and Vice President Vance expressing optimism over a potential agreement. Lower oil prices eased inflation concerns and supported Treasuries and European sovereign bonds. However, the improvement in risk sentiment was offset by renewed weakness in technology, pushing the Nasdaq 100 into technical correction territory even as broader equities proved more resilient.
The midterms are the main focus, with implications for Trump’s legislative agenda, fiscal policy and appointments, while attention later in the week turns to payrolls and other labour-market and activity data.