S&P 500 consolidates while EUR/GBP, silver try to stem decline

Macro update

US inflation data: Investors are focused on June's consumer price report due later today, with a core CPI reading of 0.3% or higher seen as increasing the likelihood of a Federal Reserve rate hike as early as July, following hawkish comments from Governor Christopher Waller that borrowing costs may need to rise again in the near term.

Oil climbs to a four-week high: Brent crude rose nearly 3% to around $84.80 a barrel after the US reinstated its naval blockade of Iran and proposed a 20% levy on cargo transiting the Strait of Hormuz, while tanker traffic through the waterway fell to its lowest level in two months.

Wall Street retreats as geopolitical tensions escalate: The S&P 500 declined 0.79% and the Nasdaq lost 1.55% as renewed US-Iran hostilities weighed on investor sentiment, with memory-chip manufacturers leading the losses and SK Hynix dropping 9.3% following its strong Nasdaq debut last week.

Asian equities move lower: MSCI's Asia-Pacific index excluding Japan fell 1.7%, led by declines in Taiwan and South Korea, although Chinese markets proved more resilient after stronger-than-expected June trade data.

Yen remains close to multi-decade lows: The Japanese currency strengthened marginally to ¥162.30 per dollar but stayed under pressure, keeping markets alert for possible intervention after Japan's finance minister suggested the government could adjust state pension fund allocations if market conditions change significantly.

US earnings season gathers pace: Major US banks, including JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs and Wells Fargo, are due to report quarterly results, marking the start of a closely watched second-quarter earnings season.

S&P 500 grapples with resistance

The S&P 500 continues to flirt with its 7,578 mid-June peak which so far acts as resistance. While it and this week's high at 5,580 cap on a daily chart closing basis, a slip towards the March-to-July uptrend line at 7,456 may ensue. While the next lower 8 July low at 7,422 underpins, though, overall upside pressure should be maintained.

A rise above the 7,578-to-5,580 resistance area would push the June record high at 7,620 to the fore.

Short-term outlook: bullish while above the 8 July low at 7,422

Medium-term outlook: bullish while above the 9 June low at 7,238

S&P500 daily candlestick chart

EUR/GBP trades in 1-year low

EUR/GBP is trying to find support, having slid to £0.8509 - the June 2025 low - last week. For it to be able to bounce back, a rise above this week's high at £0.8541 needs to occur. If so, minor resistance around the 23 June 2025 high at £0.8575 may be revisited.

A fall through £0.8509 would open the way for the 61.8% Fibonacci retracement of the 2024-to-2025 bull market at £0.8469 to be reached.

Short-term outlook: bearish while below the 23 June 2025 high at £0.8575

Medium-term outlook: bearish while trading below the 26 June high at £0.8651

EUR/GBP daily candlestick chart

Silver price hovers above key support

The price of Silver seems to be finding support above its late June low at $55.5967 which may nonetheless be retested over the coming days. Were it to give way, the October-to-November 2025 highs at $54.4852-to-$54.3935 may be reached next.

In case of the price of the precious metal stabilising and a rise above Friday's high at $60.7700 to be seen, the 11 June low at $61.5050 may be reached, as well as last week's high at $63.2765. This level would need to be overcome for a bullish reversal towards the 22 June high at $67.1685 to gain traction.

Short-term outlook: bearish while below the 6 July high at $63.2765

Medium-term outlook: bearish while below the 17 June high at $71.5641

Sliver daily candlestick chart