Just last weekend, the United States launched attacks on Iran's Fordow, Natanz and Isfahan nuclear facilities, causing a sharp escalation of tensions in the Middle East. US President Trump announced that these key nuclear facilities have been "completely destroyed". This action has not only attracted great attention from the international community, but also intensified the market's concerns about geopolitical risks, especially the potential impact on the US stock market.
At the same time, the direction of the Fed's monetary policy has also become a focus. On Tuesday (June 24) and Wednesday (June 25), Fed Chairman Powell will attend hearings in the Senate and the House of Representatives in succession and accept questions from members of parliament. Powell is expected to provide an updated assessment of the current economic situation in the United States and may reveal more information about the future direction of monetary policy. If his speech is vague or tough, it may cause significant fluctuations in the stock market.
In addition, this Friday (June 27), the United States will release the core PCE price index for May, which is one of the important indicators for the Fed to measure inflation levels. The market predicts that the data will increase by 2.3% year-on-year, a slight increase from the previous month. If the actual value exceeds expectations, it may delay the time when the Fed will restart the rate cut.
In response to the recent US-Iran conflict, analysts believe that this marks a new unpredictable stage in the Middle East. The military action of the Trump administration is seen as a turning point, which may bring more uncertainty and challenges. Iran then used a long-range ballistic missile called "Khyber" to counterattack Israel, further exacerbating the tension in the region.
In the global financial market, this unstable geopolitical environment is gradually being reflected in the prices of commodities such as oil, rather than directly in the stock market. However, as events develop, changes in investor sentiment may affect the performance of global stock markets.
Back to the economic fundamentals, despite many uncertainties, the US economy still shows a certain degree of resilience. Recently released data show that although the final GDP value in the first quarter showed a contraction in the economy, consumer spending and the job market remain robust. There are differences within the Federal Reserve on the next policy path: some officials prefer to wait for clearer economic signals before deciding whether to cut interest rates; while others believe that based on the existing information, there is still a possibility of a rate cut this year.
In the coming week, Powell's congressional testimony and the upcoming economic data will be key factors affecting the market direction. Especially considering that the US stock market is currently near its historical high, any major news may trigger a sensitive reaction in the market. Investors need to pay close attention to developments and take appropriate risk management measures.