S&P 500

Key insight

The US-Iran war is now the single biggest swing factor for markets: oil above $90 keeps the Fed frozen at 3.50–3.75% with only one cut priced for 2026, directly capping the S&P 500's re-rate potential despite a solid Q2 earnings season underway.

The S&P 500 at 7,433 sits below the July 10 swing high of 7,575 and is being held in a tug-of-war between strong AI-driven earnings (Alphabet cloud beat, $500B+ backlog) and surging oil prices at $90.8 (+4.9%) fuelled by 11+ consecutive nights of US-Iran military strikes that are suppressing Fed rate-cut expectations.

Main risk

US-Iran War Escalation & Oil Price Shock

With WTI crude at $90.8 (+4.9% today) and Brent having briefly topped $95 on July 22, a further escalation — especially any Strait of Hormuz blockade — risks pushing oil back toward $100–$115, reigniting inflation and forcing the Fed to delay its sole expected 2026 cut, crushing equity valuations.