Good morning! Trump's visit to China has concluded and it left us with little to discuss. Outside of a few minor business deals and empty statements nothing was achieved.
The Iran war is still at a stalemate. But while American politics and foreign affairs were boring this week, it's the UK and Cuba that really moved the markets.
Main Events Of The Day
#1 Iran Peace
Trump has boarded the Air Force 1 without any progress on the Iran war situation.
Additionally, we have reports that the US has totally rejected the Iranian counter-proposal, sending the chances for a permanent peace to their lowest level ever. However, traders see only limited potential for a new round of fighting, with chances for one by the end of June barely above 50%:
#2 The Strait Of Hormuz
The Strait of Hormuz remains effectively closed. Even the recent surge in traffic was not enough to sustainably move the market as traders quickly realized there is no plan.
The recent surge fully complied with the Iranian rules and consisted mainly of Chinese vessels. If anything, this might have been a gesture towards China during Xi's meeting with Trump.
As we enter the last day of trading, energy prices are on the rise again:
#3 An Uneventful Meeting
Trump's China visit has ended and if you feel like you missed some big news, I can tell you you didn't.
The visit produced a few minor business deals (Boeing to sell 200 planes to China and Nvidia to sell some chips), but other than that we had no breakthrough, either on tariffs or on the Iran war.
Traders were forecasting a breakthrough, especially on the tariff issue with prices on a tariff agreement reaching over 75c on the day of the meeting.
#4 First Cuba Meeting
Markets were a bit shocked to learn that John Ratcliffe, the director of the CIA, met with representatives of the Cuban regime.
Trump recently teased a diplomatic meeting, sending the prices slightly higher. However, many traders assumed that the China visit must conclude before any progress can be made.
That being said, a spook meeting with a foreign government is not highly indicative of any deal being imminent:
#5 Starmer's Roller Coaster
Keir Starmer has had a roller-coaster ride this week. At one point, chances for his resignation or removal reached over 75%, only to fall back to 27%.
He might have avoided the inevitable again. But the chances for him being out by the end of the year are still at 72%. In British politics, once your opponents sense weakness, it's extremely difficult to stop them from trying to get you.
Wrap up
We are a bit disappointed by Trump's visit to China. But maybe our expectations were too high for an event that was done for the PR purposes.
We will continue to monitor the situation on prediction markets.
Make sure to follow prediction markets live to get fresh information on the conflict. Stay strong and see you tomorrow for another Morning Brief!
This is not official investment or life advice. Do your own research. These are only my opinions and I encourage anyone to do their own research before putting any money anywhere.