The yield on Japan's 30-year bond fell 1 bp to 3.840%.

After the Islamabad MoU, substantive US–Iran talks have opened, but CITIC Securities says the main near-term risk is domestic political pressure in the US, Israel and Iran rather than an immediate war. Keeping the Strait of Hormuz fully open faces significant hurdles; apart from proxy-force dynamics, meaningful progress on the nuclear file within 60 days is unlikely and a prolonged stalemate is possible — lowering the odds of rapid large-scale conflict but also of a stable agreement. Strategically, the episode will push Gulf states back toward a security-first governance posture since the Arab Spring while sharpening incentives for economic diversification, potentially creating cooperation opportunities for China in traditional and new energy and the digital economy.

JP Morgan Private Bank EMEA equities strategist Natalia Lipishina warns that a sustained or further drop in oil prices could undermine a key source of earnings growth, prompting downward revisions to energy estimates and potential spillovers across other sectors. She says this raises the risk that European equities will underperform US and emerging-market peers in H2. Lipishina and JP Morgan remain constructive on AI-related themes — technology, semiconductors and industrials tied to global infrastructure spending — and see opportunistic value in luxury and civil aviation after recent underperformance, while preferring US and emerging-market stocks for stronger earnings trajectories.