Markets were largely range-bound ahead of Wednesday\u2019s US July CPI, as firmer crude kept inflation expectations elevated and pushed rate pricing back towards a Federal Reserve hike in September at above 50%. Brent rose 2.4% and WTI 2.7% as talks over reopening the Strait of Hormuz appeared stuck, while Libya\u2019s NOC warned it could declare force majeure and halt the 120,000 bpd Zawiya refinery if drone attacks persist. Gold slipped 0.4% even as it held above two-month highs, the dollar index added 0.1%, and yields sat at 4.73% on the US 10-year versus 3.20% on Bunds and 5.04% on gilts. Equities were mixed, with the Hang Seng down 1.1%, European indices between -0.3% and +0.2%, and US futures within -0.1% to +0.1%; bitcoin fell 1.3% and ether 2.0%.<\/p>\n\n
In Asia-Pacific, the RBA held the cash rate at 4.35% for a second straight meeting on a unanimous vote; projections lifted December 2026 trimmed mean inflation to 3.3% from 2.6% and cut December 2026 GDP growth to 1.4% from 2.1%. Singapore\u2019s Q2 GDP was revised to 1.4% q\/q from 1.1% and to 5.9% y\/y from 5.7%, while South Korea\u2019s first 10 days of August saw exports up 45.3% y\/y and imports up 23.1%. In corporate and supply-chain developments, Intel increased an equity raise to $20bn from $15bn at at least $95 a share with net proceeds of $19.7bn and a 31.6m-share greenshoe, and CXMT was reported to have exceeded 90% yields on 17nm DDR5 versus Samsung\u2019s roughly 92\u201393%. Norsk Hydro cut Alunorte alumina output, a ~6.3Mt-a-year facility, to 50% after a gas disruption, guiding a $75\u2013100m Q3 2026 hit; Iran\u2019s oil minister said 95 mcm\/d of gas returns by end-September, while Ukraine\u2019s proposed Moldova\u2013Constan\u021ba rail route was pegged at 4.5mt annual capacity against a 38\u201340mt export forecast.<\/p>\n\n
We should prepare for continued upward momentum in oil markets by securing long call options on Brent and WTI crude. With the Strait of Hormuz negotiations stalled and the U.S. demanding war reparations from Iran, supply risks are heavily underpriced. Historically, localized conflicts in these key shipping lanes have triggered sudden 10% to 15% spikes in global energy prices, making short-term upside protection vital for our portfolios.<\/p>\n\n
We must adjust our fixed-income positions as the probability of a September Federal Reserve rate hike climbs back above 50% ahead of tomorrow’s CPI print. Given the hawkish commentary from central bankers like Hammack and Australia’s RBA actively debating another rate increase, betting on imminent rate cuts is premature. We can exploit this shift by shorting near-term interest rate futures or purchasing put options on Treasury notes to hedge against rising yields.<\/p>\n\n
We should maintain exposure to gold derivatives as the metal holds strong at its highest levels in over two months, trading near historical resistance markers. Geopolitical friction combined with rising inflation expectations typically boosts gold’s appeal as a sovereign hedge, a pattern clearly seen during previous energy-driven inflation cycles. Utilizing bull call spreads on gold futures allows us to capture the upside momentum while strictly limiting our premium risk.<\/p>\n\n
We need to adopt high-volatility strategies, such as straddles or strangles, on major semiconductor and tech equities in the coming weeks. Despite China\u2019s CXMT achieving over 90% yields on DDR5 memory, the global AI-driven hardware market remains tight, and massive fundraising efforts like Nvidia\u2019s proposed $500 billion infrastructure target will fuel massive price swings. These large-scale capital plays combined with highly anticipated tech IPOs in September mean option premiums are bound to rise significantly.<\/p>\n\n\n\n