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June 1, 2026 - 01:24
4 minutes
(Bloomberg) — Oil climbed and the dollar strengthened as tensions remained elevated in the Middle East, with negotiations over a permanent US-Iran ceasefire showing little sign of a breakthrough.Brent crude climbed early Monday to trade around $93 a barrel after closing at its lowest since mid-April on Friday. The dollar was slightly stronger against all its Group-of-10 peers. Futures contracts for the tech heavy Nasdaq 100 Index edged up 0.2% after Wall Street gauges closed at a record on Friday on expectations for a US-Iran deal and enthusiasm for the artificial-intelligence trade.US forces sustained minor injuries in an Iranian attack on a Kuwaiti airbase over the weekend and Israel stepped up its offensive against the Tehran-backed Hezbollah in Lebanon. Meantime, Washington and Tehran exchanged messages seeking amendments to a draft agreement that would extend the ceasefire and reopen the Strait of Hormuz, though it remained unclear whether negotiations were making meaningful progress.The renewed tensions risk interrupting a global stock rally driven by unbounded enthusiasm for sectors touched by the AI trade. Oil prices had also retreated to their April lows, helping fuel a relief rally in global bond markets that had been ravaged by fears of energy-linked inflation.“Negotiations between the US and Iran remain an outstanding concern and a source of potential volatility going forward,” said Kyle Rodda, senior analyst at Capital.com. “The risk is the price has been misled by propaganda as the Trump administration sells a looming deal but, to this point, the Iranians remain reticent on the matter.”In other corners of the market, gold fluctuated to trade around $4,540 an ounce, while Bitcoin led cryptocurrencies higher.On Friday, US President Donald Trump posted on social media he was ready to make a “final determination” on a preliminary agreement to extend the ceasefire. Hours later, he left the Situation Room meeting without any decision being made, the New York Times reported.Amendments to the deal continue to be proposed by both sides, though both the US and Iran might ultimately reject the changes and the deal would collapse, the semi-official Tasnim news agency reported Sunday.Meantime, Israel made its broadest incursion into Lebanon in a quarter-century after Hezbollah stepped up attacks in the country’s north.“There are likely going to be more setbacks, but the market has already priced an agreement in Iran,” Patrik Lang, chief investment strategist at Geneva-based Global Gate Asset Management. “I wouldn’t expect big market moves, except maybe lower oil, once the deal is announced.”Chinese assets will be in focus in early trading after the official gauge of factory activity slowed in May, adding to signs the world’s second biggest economy is faltering from pressures on global demand and input costs from the Iran war.The official manufacturing purchasing managers’ index fell to 50 from 50.3 in April, the National Bureau of Statistics said Sunday. The non-manufacturing measure of activity in construction and services rose more than forecast to 50.1 from 49.4 last month. A reading below 50 indicates contraction.“China’s economic recovery remains uneven” with traditional businesses experiencing headwinds while high-tech sectors charge ahead, Wee Khoon Chong, an Asia-Pacific macro strategist at BNY wrote in a note to clients. Still, the firm retains a positive view over Chinese stocks and the yuan amid resilient domestic confidence and optimism toward the tech sector.Some of the main moves in markets:StocksS&P 500 futures were little changed as of 8:19 a.m. Tokyo time Hang Seng futures rose 0.4% S&P/ASX 200 futures fell 0.1% CurrenciesThe Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1654 The Japanese yen was little changed at 159.39 per dollar The offshore yuan was little changed at 6.7641 per dollar The Australian dollar was little changed at $0.7182 CryptocurrenciesBitcoin rose 0.3% to $73,832.82 Ether rose 0.3% to $2,010.64 BondsAustralia’s 10-year yield advanced four basis points to 4.87% CommoditiesWest Texas Intermediate crude rose 2.5% to $89.51 a barrel Spot gold was little changed This story was produced with the assistance of Bloomberg Automation.©2026 Bloomberg L.P.
