Knowledge Center
Market Currents – 6/15/26
- The Skies Begin to Clear. May marked a clear change in tone from earlier in the spring. Equity markets extended their gains, volatility fell, and the daily anxiety that had defined much of the year started to ease. Several of the storylines that had been weighing on sentiment for months began moving in a more constructive direction at once. Oil prices eased, the Iran standoff moved toward resolution, the Federal Reserve completed a smooth leadership transition and earnings continued to come in better than expected.
- A Peace Deal Changes the Market’s Math. The preliminary peace agreement between the United States and Iran was the most consequential market development in recent weeks. The immediate focus was on reopening the Strait of Hormuz, but the implications stretch well beyond oil. Lower energy prices would ease pressure on everything from household budgets to corporate profit margins, with inflation the most important beneficiary of all. None of this means the tensions have been permanently resolved, and the region’s history argues against declaring victory too soon. But the worst-case outcomes that had loomed over markets have receded into the background.
- SpaceX Lands on Wall Street. Mid-June brought one of the most anticipated debuts in modern financial history, as SpaceX began trading on the Nasdaq following the largest IPO ever by total deal size. This was hardly a conventional offering. SpaceX came public as an established force in commercial rocket launches and satellite internet, but its valuation reaches well beyond what the company does today. A substantial portion of the price tag rests on ambitious future projects, including the still-developing Starship rocket, satellite service delivered directly to mobile devices, and eventually, AI data centers operating in orbit. These ventures could dramatically expand the company’s reach, but many remain years away from commercial scale. The offering is also inseparable from Elon Musk himself, whose track record is clearly part of what investors are buying. More broadly, the reception shows just how willing investors remain to pay today for bold growth stories that may take years to fully develop.
- The Fed’s Quiet Hawkish Tilt. Kevin Warsh inherited an awkward moment to take over the Federal Reserve. Headline inflation moved back above 4%, the job market remained surprisingly sturdy, and the 10-year Treasury yield spent much of the period grinding higher toward 4.5%. Together, those developments reopened a possibility that markets had largely written off, with the Fed’s next move potentially being a rate increase rather than a cut. The important caveat is that nearly all of the recent upward pressure on prices has come from oil and energy, which in turn has been driven by the conflict with Iran. A durable resolution could remove that source of inflation relatively quickly and shift the policy conversation back toward lower rates.
- The Market Can Finally Refocus on Fundamentals. For much of the spring, the market conversation centered on everything except the companies themselves. Oil prices, the Iran conflict, the Fed succession, and each new inflation report pushed the operating performance of American businesses into the background. That is starting to change. With the geopolitical overhang easing, investors are turning their attention back to one of the strongest earnings seasons in years, powered in part by an AI buildout that continues to drive enormous investment across the economy. Headlines may dictate the short-term swings, but earnings ultimately carry more weight over time. As always, we are grateful for the trust you continue to place in us.