The dominant overnight macro driver is the collapse of the US-Iran ceasefire, with President Trump declaring 'let's finish the job' and revoking Iran's oil export licence — Brent crude surged 6.65% to $79.09/bbl and WTI rose 5.82% to $74.54/bbl, pricing in a material risk premium for Strait of Hormuz disruption that routes approximately 20% of global oil supply. US Treasury yields moved sharply higher across the curve — the 2-year reached 4.19% (+6bp), the 10-year 4.55% (+7bp) and the 30-year breached 5.05% (+6bp) — reflecting the dual pressure of geopolitical energy inflation and FOMC minutes that revealed several Fed members favoured a rate hike at the June meeting, with nine dot-plot participants now pencilling in at least one hike before year-end under new Chair Kevin Warsh. The IMF's July WEO, which cut 2026 global growth to 3.0% and projected oil prices rising nearly 32%, was built on the assumption that the Strait of Hormuz reopens later this month — an assumption that is now in serious doubt. Gold fell 1.40% to $4,087.30/oz despite the geopolitical escalation, as the yield backup and dollar firmness weighed on the metal, while the VIX rose 4.96% to 16.93, signalling a modest but real uptick in hedging demand.

For Asia-Pacific investors, the cross-asset pressure is concentrated in three areas. First, Japanese semiconductor and electronic components exporters — Kioxia Holdings, Taiyo Yuden, Murata Manufacturing and Disco Corporation each shed more than 7% — are caught in the twin headwinds of the Samsung earnings disappointment and DeepSeek's reported move to build its own chips, calling the near-term AI hardware demand trajectory into question; the Nikkei VIX fell 20.5% to 29.7, suggesting the volatility was more directional selling than panic hedging. Second, the yen sits at 162.53 per dollar, remaining under structural pressure despite the BoJ's June hike to 1.0%, with Goldman Sachs having revised its 12-month USD/JPY target to 165 — a weaker yen raises import costs, compounding the energy price shock for Japan's trade-deficit economy. Third, the KRW fell 1.03% to 1,504.24 per dollar as the KOSPI dropped 4.91%, the worst regional performer, reflecting concentrated exposure to Samsung Electronics and SK Hynix at the epicentre of the AI memory re-rating; the CNY edged to 6.802, a modest 0.13% move, consistent with PBOC managed stability amid China's own equity softness.