Archax Weekly Market Update, Apr 13 2026

The failure of US-Iran peace talks over the weekend has pushed the conflict into a more dangerous phase. A 21-hour negotiation in Pakistan ended without agreement, leaving the fragile ceasefire in limbo and removing any near-term off-ramp. In response, Trump has announced a US naval blockade of the Strait of Hormuz - a move that directly targets Iran’s oil exports but also risks choking off a critical artery for global energy flows.

That shift is already feeding through across assets. Oil has surged back above $100, with Brent jumping 7% to ~$103, while physical cargoes are reportedly clearing well north of $140 as refiners scramble for supply. Gas prices have also spiked. The key dynamic now is the disconnect between futures pricing and real-world scarcity, with some arguing prices still don’t reflect the true scale of the shock.

Cross-asset reaction reflects that tension. Equities are rolling over again (S&P futures -0.5% to -0.6%), while bonds are selling off modestly with US 10-year yields back around ~4.3–4.35% and the front-end repricing rate cuts. The dollar is firming as the preferred haven. Importantly, moves remain relatively contained suggesting markets are fatigued after weeks of headline whiplash and still holding out hope for a resolution.

The bond market has decisively shifted back to inflation. US CPI printed +0.9% MoM (largest since 2022), and traders are pushing rate cut expectations further out, with some now looking as far as 2027. The combination of resilient labour data and rising energy costs is reinforcing a higher-for-longer regime, with yields staying elevated and central banks sidelined.

That pressure is now feeding into growth. European earnings expectations still around ~10% for 2026 look increasingly unrealistic, with downgrades toward ~4-6% likely, and potentially worse if oil sustains above $100. Companies are facing rising input costs, weaker demand, and less pricing power than in 2022, pointing to margin compression across cyclicals and consumer sectors.

Bitcoin has slipped back toward ~$70k (down ~1%), while Ethereum has underperformed slightly (–1.5%), both tracking broader risk sentiment rather than acting as hedges. Price action remains rangebound, with BTC still largely stuck between ~$65k–$75k. Despite that, resilience is notable particularly given sustained geopolitical stress but conviction is clearly lacking, with markets in wait-and-see mode heading into each new headline.

Gold, meanwhile, is starting to stabilise and reassert its role. After an initial liquidity-driven selloff, positioning has reset and institutional buyers are returning. UBP has begun rebuilding exposure, forecasting $6,000 gold by year-end supported by central bank demand, fiscal concerns and persistent geopolitical risk. The same forces weighing on gold short term are strengthening its longer-term case.

Markets are being forced to price a world of constrained energy supply, persistent inflation, tighter financial conditions and rising geopolitical risk, with no clear path to resolution. Until there’s clarity on both the trajectory of the conflict and the status of Hormuz, positioning is likely to remain cautious, conviction low, and volatility driven by headlines rather than fundamentals.