Israeli attack pushed oil higher—June 16, 2025

Stocks gained for much of the week before a risk-off mood took hold on Friday following Israel’s sweeping attack on Iran. Energy, autos, and real estate equities led the market as oil prices surged and interest rates dropped. Tesla rebounded 10.22% as the spat between CEO Elon Must and President Trump seemed to cool, sending the Magnificent 7 up 0.63%. Forward earnings expectations for the S&P 500 appear to have stabilized as a weaker dollar should mechanically boost foreign profits. The forward P/E ratio hit 22x for the first time since February.

A weekly recap of equities, fixed income, commodities, and macroeconomic analysis from the FS Investments research team.

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Chapters

• 0:00 Today is June 16 2025
• 0:12 Equities
• 1:00 Fixed Income
• 1:44 Commodities
• 2:29 Economic Overview
• 3:30 Learn more at FSinvestments.com

Transcript

0:05

This is the FS Investments Market Minute, a weekly recap from the FS investments research team. Today is June 16th, 2025. Inequities stocks gained for much of the week before. A risk off mood took hold on Friday following Israel's sweeping attack on Iran energy, auto, and real estate. Equities led the market as oil prices surged and interest rates dropped. Tesla rebounded 18% as the SPAC between CEO Elon Musk and President Trump seemed to cool. Sending the magnificent seven up 1% forward earnings expectations for the s and p 500 appear to have stabilized as a weaker dollar should mechanically boost foreign profits. The forward price to earnings ratio officially hit 22 x for the first time since February. In fixed income, incoming data pushed interest rates down for much of the week with a boost on Friday, leaving the 10 year treasury yield. Five basis points lower a softer than expected CPI report renewed calls for the Fed to lower rates, especially as jobless claims have risen, but the market implied forecast remains at. Two cuts in 2025. There is a near zero chance of the Fed easing at next week's FOMC meeting. The Bloomberg Ag has gained almost 3% this year and is on track for its best first half since 2020. And credit markets have largely kept pace. In commodities, crude prices surged as Israel undertook a sweeping attack on Iran. Brent Crude. The global benchmark jumped to$74 per a barrel its highest level since early April. Despite the initial Israeli strikes not targeting oil infrastructure, new hostilities threatened the roughly 1.5 million barrels of oil per day of sanction skirting Iranian oil exports, much of which goes to China. This occurred as US crude rig counts have plunged rapidly shifting the outlook for oil supply. Gold surged to an all time high on the news as investors sought safe havens. Here's the economic overview. Economic data painted a broadly disinflationary picture. Although Israel's attack on Iran quickly usurped those headlines. Headline CPI, increased 0.1% month over month against a consensus of 0.2% and core CPI Rose 0.1% month over month against a consensus of 0.3%. Services, prices continue to drive inflation lower, especially housing, which comprises around a third of core CPI. Initial and continuing claims continued to inch higher. Suggesting continued, but modest labor markets softening. The University of Michigan consumer sentiment index rose to 60.5 and one year inflation expectations fell from 6.4% to 5.1% a sign tariff pessimism may have peaked. And here is take two. This is the FS Investments Market Minute. A weekly recap from the FS Investments research team. Today is June 16th, 2025. Inequities stocks gained for much of the week before. A risk off mood took hold on Friday. Following Israel's sweeping attack on Iran energy, auto, and real estate, equities led the market as oil prices surged and interest rates dropped. Tesla rebounded 18% as the spat between CEO. Elon Musk and President Trump Seemed to cool, sending the magnificent seven up 1%. Forward earnings expectations for the s and p 500 appear to have stabilized as a weaker dollar should mechanically boost foreign profits. The forward price to earnings ratio officially hit 22 x for the first time since February. In fixed income, incoming data pushed interest rates down for much of the week with a boost on Friday, leaving the 10 year treasury yield. Five basis points lower a softer than expected CPI report renewed calls for the Fed to lower rates, especially as jobless claims have risen, but the market implied forecast remains at. Two cuts in 2025. There is a near zero chance of the Fed easing at next week's FOMC meeting. The Bloomberg Ag has gained almost 3% this year and is on track for its best first half since 2020. And credit markets have largely kept pace in commodities. Crude prices surged as Israel undertook a sweeping attack on Iran. Brent Crude, the global benchmark jumped to $74 per a barrel its highest level since early April. Despite the initial Israeli strikes not targeting oil infrastructure, new hostilities threaten the roughly 1.5 million barrels of oil per day of sanctioned skirting Iranian oil exports, much of which goes to China. This occurred as US crude rig counts have plunged rapidly shifting the outlook for oil supply, gold surge to an all time high on the news as investors sought safe havens. Here's the economic overview. Economic data painted a broadly disinflationary picture. Although Israel's attacks on Iran quickly usurped those headlines. Headline CPI, increased 0.1% month over month against a consensus of 0.2% and core CPI Rose 0.1% month over month against a consensus of 0.3%. Services. Prices continue to drive inflation lower, especially housing, which comprises around a. Third of core CPI. Initial and continuing claims continued to inch higher. Suggesting continued, but modest labor market softening. The University of Michigan. Consumer sentiment index rose to 60.5 and one year inflation expectations fell from 6.4% to 5.1% assigned tariff pessimism may have peaked.