Global markets open week mixed as geopolitical concerns persist

Global markets traded mixed Monday as investors assessed renewed geopolitical tensions in the Middle East while also looking ahead to key economic data and central bank signals expected this week.

Investor sentiment remained cautious despite reports that the US and Iran had agreed to halt mutual attacks and resume talks after exchanges over the weekend. According to Axios, citing a senior US official, Washington and Tehran are due to meet in Qatar on Tuesday to discuss disputes over the Strait of Hormuz, while technical talks that began in Switzerland will continue.

Analysts said the developments suggest the situation in the Middle East could shift rapidly, keeping investors cautious despite signs of easing tensions.

Markets are also focused on the release of US nonfarm payrolls later this week, while speeches by Federal Reserve Chair Kevin Warsh, European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey at the ECB Forum are expected to provide fresh clues on the interest-rate outlook.

Concerns over elevated valuations of artificial intelligence-related companies also weighed on investor sentiment, with investors questioning whether heavy AI spending will translate into profits.

Meanwhile, US President Donald Trump announced a 100% tariff on countries imposing digital services taxes on American companies, adding another source of uncertainty for investors.

Brent crude fell 0.98% to $72.80 a barrel after reports that hostilities between the US and Iran had subsided.

Gold slipped 0.4% to $4,058 per ounce, while the benchmark US 10-year Treasury yield stood at 4.39% and the US Dollar Index traded around 101.4.

On Friday, Wall Street ended lower as technology shares remained under pressure. Nvidia fell 1.6%, AMD lost 2%, Intel dropped 3.4%, Broadcom declined 3.7% and Micron Technology tumbled nearly 7%. Healthcare stocks, however, outperformed, with Eli Lilly gaining 7% and Johnson & Johnson and AbbVie each rising 4%.

Reports that ChatGPT maker OpenAI is considering postponing its initial public offering amid SpaceX’s weak post-IPO performance also increased pressure.

SpaceX will reportedly begin trading as a component of the Nasdaq 100 just before the market opens on July 7.

The Dow Jones Industrial Average fell 0.09%, the S&P 500 slipped 0.05% and the Nasdaq Composite lost 0.24% on Friday, while US index futures opened Monday mixed.

European markets also closed lower Friday as technology shares declined amid expectations the Federal Reserve will keep interest rates elevated. Germany's DAX 40 lost 0.98%, Italy's FTSE MIB 30 fell 1%, France's CAC 40 declined 0.55% and the UK's FTSE 100 slipped 0.21%.

European markets opened Monday mixed.

Asian markets traded mixed near Monday's close as investors monitored reports that China tightened export controls on 20 Japanese defense companies and research organizations, fueling concerns over renewed trade tensions.

On Monday, South Korean tech giants Samsung Electronics and SK Hynix announced plans to build an 800 trillion won ($518 billion) chipmaking hub to support AI growth.

Japan's retail sales rose 1.9% month-on-month and 5.3% year-on-year in May, exceeding expectations and pointing to resilient domestic demand.

Near the close, Japan's Nikkei 225 fell 1% and South Korea's Kospi lost 2.3%, while China's Shanghai Composite gained 0.2% and Hong Kong's Hang Seng advanced 2.1%.

*Writing by Emir Yildirim​​​​​​​