Weekly market recap & what's ahead

16 June 2025 (recap week of 9 to 13 June 2025)

Headlines & introduction

Geopolitical tensions and policy uncertainty drove global markets this week. The Israel-Iran conflict triggered sharp moves in oil, gold, and equities. US inflation data surprised to the downside, reviving hopes for Fed rate cuts, but fresh tariff threats and volatile commodity prices kept sentiment fragile. Volatility spiked late in the week as investors shifted focus to the Fed’s upcoming rate decision, retail sales, and key earnings.
Investors faced an environment where headlines could drive swift shifts in sentiment and asset prices.

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Equities

US stocks saw choppy trading, with early-week optimism on US-China trade talks giving way to a Friday selloff as Israel attacked Iran (June 13). The S&P 500 fell 1.1%, Nasdaq -1.3%, and Dow -1.8% on Friday, led by declines in tech (Nvidia -2.1%, Apple -1.4%) and financials (Visa, Mastercard -4%). Oracle surged 13% on earnings (June 12), offsetting Boeing’s 4.7% post-crash drop. Defense and energy outperformed (Lockheed Martin, Exxon, Shell), while airlines and autos slumped. Europe hit one-month lows (STOXX 50 -1.4%), as energy and defense rallied on safe-haven demand, but banks and tech lagged. Asia tumbled Friday on risk-off moves, with the Nikkei -1.2% and KOSPI -1.3%.
Sector rotation was evident, with investors favoring defensive names over growth and cyclical stocks by week’s end.

Volatility

Market volatility surged late week, with the VIX rising 15.5% to 20.8 on June 13, the highest in a month as Middle East conflict escalated. Short-term indicators (VIX1D) spiked above 21 but fell back by close. Volatility remains below April panic highs, suggesting defensive positioning rather than outright panic.
The sudden rise in volatility reflected heightened geopolitical risk, but markets did not experience the disorder seen during earlier crisis periods.

Digital assets

Crypto tracked risk sentiment: Bitcoin slid 1.4% to $104,200 and Ethereum fell 5% to $2,510 on Friday amid geopolitical turmoil. Major ETFs (IBIT -1.8%, ETHA -4.3%) saw mild outflows, but three weeks of net inflows signal ongoing institutional demand. Crypto stocks like Coinbase and MicroStrategy declined. Overall, crypto markets remain sensitive to macro headlines and await Fed direction.
Institutional appetite for regulated crypto vehicles persisted even as retail activity softened on volatility spikes.

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Fixed income

US Treasury yields rose Friday as oil spiked; the 10-year traded at 4.43% (up from 4.36% Thursday). Soft US CPI and PPI earlier in the week had briefly lowered yields, but safe-haven flows dominated after the Israel-Iran attacks. Bund yields rose to 2.54%. Japanese yields fell on global risk aversion but edged up ahead of the BoJ meeting.
Bond markets responded to a push-pull between inflation relief and renewed geopolitical safety demand.

Commodities

Crude oil spiked as much as 13% to $78.50 (Brent) after Israel struck Iran, before paring gains. Supply risks around the Strait of Hormuz drove prices and volatility. Gold jumped above $3,400 on classic safe-haven demand. Platinum and silver saw profit-taking after recent outperformance. The Bloomberg Commodity Index gained, up 8.3% YTD.
Commodities saw two-way action as investors hedged against both supply shocks and rapid sentiment reversals.

Currencies

The US dollar fluctuated, rallying Friday as risk sentiment soured. EURUSD tested 1.15 support; USDJPY remained weak on oil-driven trade and yield differentials. Emerging market currencies faced renewed pressure. The Japanese yen moved lower as safe-haven flows briefly favored it, but higher global yields capped gains.
Currency volatility mirrored global tensions, with flows quickly shifting between safety and yield-driven trades.

Key takeaways

• Israel-Iran conflict spiked oil and gold, triggered global risk-off.
• US inflation data came in softer; Fed rate cut hopes revived.
• VIX surged 15% on Friday; volatility remains elevated.
• Bitcoin fell 1.4%, ETH -5%, but ETF inflows continue.
• Defensive stocks, energy, and gold outperformed; tech and travel lagged.
  Global investors continue to face a tug-of-war between macro shocks and policy optimism.

Looking ahead (16 to 20 June 2025)

• Fed interest rate decision (Wednesday): Markets expect no change, focus on Powell’s guidance.
• US retail sales (Tuesday) and housing data: Key reads on consumer strength.
• Juneteenth holiday (Thursday): US markets closed.
• Tesla Robotaxi rollout and key earnings from Lennar, Accenture, Kroger, and CarMax.
• Ongoing Middle East tensions and central bank meetings (BoJ, BoE) to drive risk sentiment.
  Next week’s agenda is packed with potential catalysts, and investors should brace for continued headline-driven swings.

Conclusion

This week highlighted the fragility of market sentiment amid global geopolitical risks and shifting policy signals. While strong moves in oil, gold, and volatility underscored investor nerves, underlying demand for equities and digital assets proved resilient, especially in sectors tied to defense and energy. As markets head into a week dominated by central bank decisions and ongoing geopolitical tensions, caution remains warranted, but opportunities will arise for those ready to respond to fast-moving developments.