US President Donald Trump met with President Recep Tayyip Erdoğan at the Presidential Complex as part of the 36th NATO Heads of State and Government Summit held in Ankara. The meeting addressed Turkey's procurement of F-35 fighter jets and the lifting of US CAATSA sanctions.
After the meeting, President Trump said, "Turkey has become a very strong country militarily under your leadership. I can say that we can lift the sanctions." President Erdoğan, noting that the F-35 issue is not new, said, "We received commitments for all five aircraft. Mr. Trump has also given us his word on this matter."
US-Iran tensions in the Middle East send oil prices soaring
The renewed sound of explosions in the Middle East heightened geopolitical risk perception in global markets. The US Central Command (CENTCOM) announced on social media that more than 80 targets belonging to Iran were struck. Iranian Parliament Speaker Mohammad Bagher Ghalibaf stated that the US attacks violated the memorandum of understanding.
Amid rising tensions in the region, Brent crude oil rose 5.2% to $75.8 per barrel, its fastest daily gain since April 29.
Rate hike expectations strengthen ahead of Fed minutes
The spike in oil prices fueled inflation concerns, pulling forward expectations for the Federal Reserve's monetary policy. After the strikes, the probability of a rate hike in September rose to 77% in money markets. Investors focused on clues from the Federal Open Market Committee (FOMC) meeting minutes.
The US 10-year Treasury yield rose about 10 basis points to 4.56%, while the dollar index increased 0.3% to 101.2. With a stronger dollar and higher yields, gold fell 1.4% yesterday to close at $4,106 per ounce.
US stock markets fall on Chinese AI move
Reports that Chinese startup DeepSeek has developed its own AI chip put pressure on US semiconductor manufacturers. Marvell Technology shares fell 7.5%, Lam Research 6.9%, and AMD and Applied Materials 6.5%. The S&P 500 index dropped 0.45% and the Nasdaq fell 1.16%.
The US trade deficit widened 42.2% monthly in May to $77.6 billion, its highest since March 2025. Short-term consumer inflation expectations also rose to 3.7% in June.
Mixed performance in European and Asian markets
European stock markets closed mostly lower yesterday except for the UK. The FTSE 100 gained 0.1%, while the CAC 40 fell 0.51% and the DAX 40 dropped 1.37%. German industrial production rose 0.9% month-on-month in May, above forecasts.
In Asia, markets were mixed. DeepSeek's move supported Chinese and Hong Kong markets, while the Nikkei 225 fell 0.66% and the Kospi dropped 4.35%. In Istanbul, the BIST 100 index ended the day up 0.50% at 14,497.37 points.
