The dominant macro driver on Tuesday 4 August was a sharp easing of geopolitical risk premium around the Strait of Hormuz, with optimism over a potential reopening pushing WTI crude down 5.69% to $75.77/bbl and Brent down 5.26% to $79.36/bbl — a move of that magnitude signals markets are pricing a meaningful reduction in near-term supply disruption risk rather than a marginal recalibration. Against that backdrop, safe-haven demand partially offset risk-on flows: US 10-year yields fell 5bp to 4.70% and German 10-year Bunds dropped 7.6bp to 2.97%, while gold rose 1.53% to $4,095/oz and platinum surged 7.99% to $1,747/oz — the latter likely reflecting both industrial demand optimism and residual safe-haven buying. The VIX ticked up 4.04% to 16.5 even as equities rallied, a divergence that warrants attention as a signal of residual hedging activity beneath the surface of a broadly risk-on session.

For European investors, the oil price drop is a structurally significant input cost relief for energy-intensive industries, but it lands unevenly across sectors: ENI.MI fell 1.19% and the Oil & Gas sector gained only 0.69%, confirming that integrated energy names captured little of the broader equity rally. The EUR/USD slipped 0.32% to 1.1507 and GBP/USD fell 0.48% to 1.3427, with EUR/GBP edging up 0.16% to 0.857, reflecting modest USD resilience via the DXY at 99.89 — a move that compresses EUR-reported revenues for European exporters with significant USD earnings exposure. Cross-asset pressure is most concentrated in European energy majors facing a revenue headwind from lower oil, and in rate-sensitive sectors such as banks and financials where the 7.6bp Bund rally tightens the yield environment that had been supporting net interest margins.