U.S. Stocks and Energy Markets Remain Calm Despite the U.S. Joining Israel's War On Iran

Wall Street indexes wavered around the flatline on Monday as investors assessed the tame oil market's response to the U.S. strike on Iran's nuclear sites. 

The S&P 500 index edged up a fraction, and the tech-heavy Nasdaq Composite edged down a fraction, and crude oil inched higher by 2% in New York after rising as much as 6% in London trading. 

U.S. officials confirmed three strikes on Iran's nuclear facilities and joined Israel's war on Iran. 

However, military experts in the Middle East voiced skepticism about the effectiveness of such a strike and its impact on Iran's government. 

Iran vowed to respond, and the country's parliament approved the blocking of the Strait of Hormuz, which could play a role in disrupting global energy supply. 

Despite rising tensions in the Middle East, oil markets remained relatively calm, and crude oil futures struggled to rise to a six-month high. 

European markets edged down 0.6%, and markets in Asia closed mixed as traders awaited Iran's response to the latest U.S. attacks.

Iran's ability to strike back is severely hampered as its key military ally, Russia, is struggling with its own war in Ukraine. 

Moreover, China is unwilling to be drawn into an open conflict with the U.S. and Israel and provide direct support to Iran because the second-largest economy is dependent upon exports to the U.S. markets and the U.S. dollar payment system.

The combined military power of the U.S. and Israel far outweighs Iran's military capabilities. 

Despite the U.S. and Israel's military superiority, the region's experts point to NATO's failed war in Afghanistan, which led to the replacement of one Taliban government with another Taliban government after two decades of war and more than $2 trillion of spending.

U.S. Stock Movers 

Defense stocks advanced following the U.S. attacks on Iran's nuclear sites. 

L3Harris Technologies Inc. added 1% to $252.09, Northrop Grumman Corp. advanced 1.1% to $503.14, RTX Corp. jumped 1.9% to $149.54, and Lockheed Martin Corp. edged up 0.7% to $473.70. 

Energy complex stocks traded sideways, and investors focused on ample global supply of crude oil amid Iran's threats of closing the Strait of Hormuz. 

Exxon Mobil Corp. gained 1.5% to $116.39, Chevron Corp. increased 1.3% to $151.50, ConocoPhillips advanced 1.4% to $96.0, and EOG Resources added 2% to $127.88.

European Stocks Backed Down In Muted Reaction After Middle East Tensions Flared Up

European markets traded down on Monday despite the escalating tensions in the Middle East. 

Benchmark indexes in Frankfurt, Paris, Milan, and London edged lower, and the market's reaction was muted as traders awaited Iran's reaction. 

Over the weekend, the U.S. carried out multiple aerial attacks on Iran's nuclear infrastructure, directly involving itself in Israel's war on Iran. 

The direct involvement of the U.S. raised the stakes of a wider war in the region and increased risks of disruptions of global energy supply. 

Moreover, Iran threatened to close crude oil supply through the Strait of Hormuz. 

The added tensions in the Middle East stoked fears across the Eurozone, as Russia's war in Ukraine shows no sign of abating. 

Meanwhile, over the weekend, Russia stepped up its bombing campaign, targeting multiple cities in Ukraine, including Kiev.

Europe Indexes and Yields

The DAX index decreased by 0.6% to 23,203.74, the CAC-40 index edged lower 0.7% to 7,537.22, and the FTSE 100 index declined 0.2% to 8,757.26.

The yield on 10-year German bonds inched higher to 2.55%, French bonds increased to 3.29%, UK gilts moved up to 4.57%, and Italian bonds edged higher to 3.57%.

The euro decreased to $1.15; the British pound was lower at $1.34; and the U.S. dollar was lower and traded at 81.70 Swiss cents.

Brent crude increased $0.19 to $77.46 a barrel, and the Dutch TTF natural gas was higher by €0.69 to €41.63 per MWh.

Europe Movers 

Defense stocks advanced on Monday and extended a three-month rally amid heightened geopolitical tensions. 

Thales SA edged up 0.1% to €249.80, Dassault Aviation SA edged up 0.8% to €307.40, Rheinmetall AG decreased 1.5% to €1,730.50, Safran SA edged up 0.3% to €261.0, and MTU Aero Engines AG decreased 0.2% to €372.40. 

Energy complex stocks extended 7-day gains after Brent crude soared as much as 7% before easing the intraday gain to 2%. 

Shell PLC increased 0.5% to 2,690.0 pence, BP PLC advanced 0.6% to 387.10 pence, and TotalEnergies SE rose 0.4% to €54.88. 

European Stocks Backed Down In Muted Reaction After Middle East Tensions Flared Up

European markets traded down on Monday despite the escalating tensions in the Middle East. 

Benchmark indexes in Frankfurt, Paris, Milan, and London edged lower, and the market's reaction was muted as traders awaited Iran's reaction. 

Over the weekend, the U.S. carried out multiple aerial attacks on Iran's nuclear infrastructure, directly involving itself in Israel's war on Iran. 

The direct involvement of the U.S. raised the stakes of a wider war in the region and increased risks of disruptions of global energy supply. 

Moreover, Iran threatened to close crude oil supply through the Strait of Hormuz. 

The added tensions in the Middle East stoked fears across the Eurozone, as Russia's war in Ukraine shows no sign of abating. 

Meanwhile, over the weekend, Russia stepped up its bombing campaign, targeting multiple cities in Ukraine, including Kiev.

Europe Indexes and Yields

The DAX index decreased by 0.6% to 23,203.74, the CAC-40 index edged lower 0.7% to 7,537.22, and the FTSE 100 index declined 0.2% to 8,757.26.

The yield on 10-year German bonds inched higher to 2.55%, French bonds increased to 3.29%, UK gilts moved up to 4.57%, and Italian bonds edged higher to 3.57%.

The euro decreased to $1.15; the British pound was lower at $1.34; and the U.S. dollar was lower and traded at 81.70 Swiss cents.

Brent crude increased $0.19 to $77.46 a barrel, and the Dutch TTF natural gas was higher by €0.69 to €41.63 per MWh.

Europe Movers 

Defense stocks advanced on Monday and extended a three-month rally amid heightened geopolitical tensions. 

Thales SA edged up 0.1% to €249.80, Dassault Aviation SA edged up 0.8% to €307.40, Rheinmetall AG decreased 1.5% to €1,730.50, Safran SA edged up 0.3% to €261.0, and MTU Aero Engines AG decreased 0.2% to €372.40. 

Energy complex stocks extended 7-day gains after Brent crude soared as much as 7% before easing the intraday gain to 2%. 

Shell PLC increased 0.5% to 2,690.0 pence, BP PLC advanced 0.6% to 387.10 pence, and TotalEnergies SE rose 0.4% to €54.88. 

Darden Restaurants Inc. gained 5.3% to $234.59 after the parent company of Olive Garden reported better-than-expected revenue in the fiscal fourth quarter of 2025 ending on May 25.

Sales surged to $3.27 billion from $2.96 billion, net earnings declined to $303.8 million from $308.1 million, and diluted earnings per share were flat at $2.58 from a year ago.

Sales growth was driven by a blended same-restaurant sales increase of 4.6% and sales from the acquisition of 103 Chuy's Tex Mex restaurants and 25 net new restaurants.

Olive Garden same-restaurant sales were up 6.9% in the quarter, Long Horn Steakhouse sales were up 6.7%, and Fine Dining sales were down 3.3%.

During the quarter, the restaurant operator repurchased $51 million of its own stock, and it authorized an additional $1 billion on June 18.

In addition, the company proposed a quarterly cash dividend of $1.50 per share, an increase of 7.1% from a year ago, payable on August 1 to shareholders on record on July 10.

Darden Restaurants guided full-year 2026 sales to grow between 7% and 8%, compared to $12.08 billion in fiscal year 2025, and same-restaurant sales to increase between 2% and 3.5%.

Furthermore, the company plans to open between 60 and 65 new restaurants.

Full-year diluted earnings per share from continuing operations are expected to be between $10.50 and $10.70, compared to $8.88 a year earlier.

Accenture Plc. dropped 5.35% to $290.0 after the consulting company reported better-than-expected quarterly earnings, but new orders fell short of expectations.

Revenue in the fiscal third quarter ending on May 31 jumped to $17.73 billion from $16.47 billion, net income edged up to $2.20 billion from $1.93 billion, and diluted earnings per share rose to $3.49 from $3.04 a year ago.

New bookings in the quarter declined 6% to $19.7 billion and 7% in local currency from a year earlier, as consulting new bookings were $9.08 billion and managed services new bookings were $10.62 billion.

The company proposed a quarterly cash dividend of $1.48 per share, representing a 15% increase from a year ago, and also repurchased 6.0 million shares for a total of $1.8 billion in the quarter.

The technology and business outsourcing services provider guided full-year revenue to grow between 6% and 7% in local currency, compared to $64.90 billion, and diluted earnings per share between $12.77 and $12.89, compared to $11.44 in 2024, respectively.

CarMax Inc. surged 8.04% to $69.50 after the used-car retailer reported better-than-expected results for the fiscal first quarter ending on May 31.

Revenue edged up to $7.55 billion from $7.11 billion, net earnings climbed to $210.38 million from $152.44 million, and diluted earnings per share rose to $1.38 from 97 cents a year ago.

Comparable store sales increased 8.1% as retail used unit sales jumped 9.0% and wholesale unit sales increased 1.2%.

The company bought 336,000 vehicles from consumers and dealers, an increase of 7.2% from a year earlier, as 288,000 vehicles were purchased from consumers, up 3.3%, and 48,000 vehicles were purchased through dealers, up 38.4%.

During the first quarter, the used-car retailer bought back $199.8 million in shares of its own stock.

Japan's Indexes Erased Early Losses After Global Crude Oil Supply Disruption Anxieties Eased

Japan's indexes declined on Monday and extended losses for the third consecutive session. 

The Nikkei 225 Stock Average decreased 0.2%, and the Topix declined 0.3% after the U.S. joined Israel's war targeting Iran's nuclear infrastructure. 

Risk appetite weakened amid worries that the disruption in global crude oil and natural gas supply will stoke inflation at home and abroad. 

On the economic front, Japan's services sector expanded for the third consecutive month in June, and the manufacturing sector activities returned to growth for the first time since May 2024. 

The au Jibun Bank Japan Services Purchasing Managers' Index increased to 51.5 in June from a final 51.0 in May, S&P Global reported Monday. 

The services sector activities expanded for the third month in a row, and new orders expanded and export orders edged up slightly. 

The au Jibun Bank Japan Manufacturing PMI edged up to 50.4 in June from 49.4 in May, according to a flash estimate released by S&P Global. 

The increase in manufacturing activities was driven by a rise in output and purchases of inventories, and the backlog of work declined at a slower pace. 

Japan Indexes Stocks 

The Nikkei 225 Stock Average decreased 0.2% to 38,337.35, and the broader Topix index declined 0.3% to 2,761.99. 

Tokyo Electron decreased 1.1% to ¥23,705.0, Advantest Corp. dropped 1.2% to ¥9,710.0, and Disco Corp. fell 1.6% to ¥36,110.0. 

Seven & I Holdings rose 1% to ¥2,264.50, Fast Retailing Co. Ltd. edged up 0.7% to ¥46,360.0, Takashimaya Corp. declined 0.4% to ¥1,094.50, and Aeon Corp. fell 1.2% to ¥4,453.0. 

Nippon Yusen KK edged up 0.6% to ¥5,085.0, Mitsui O.S.K. Lines dropped 0.6% to ¥4,798.0, and Kawasaki Kisen Kaisha Ltd. added 0.8% to ¥2,039.0. 

Japan's Indexes Erased Early Losses After Global Crude Oil Supply Disruption Anxieties Eased

Japan's indexes declined on Monday and extended losses for the third consecutive session. 

The Nikkei 225 Stock Average decreased 0.2%, and the Topix declined 0.3% after the U.S. joined Israel's war targeting Iran's nuclear infrastructure. 

Risk appetite weakened amid worries that the disruption in global crude oil and natural gas supply will stoke inflation at home and abroad. 

On the economic front, Japan's services sector expanded for the third consecutive month in June, and the manufacturing sector activities returned to growth for the first time since May 2024. 

The au Jibun Bank Japan Services Purchasing Managers' Index increased to 51.5 in June from a final 51.0 in May, S&P Global reported Monday. 

The services sector activities expanded for the third month in a row, and new orders expanded and export orders edged up slightly. 

The au Jibun Bank Japan Manufacturing PMI edged up to 50.4 in June from 49.4 in May, according to a flash estimate released by S&P Global. 

The increase in manufacturing activities was driven by a rise in output and purchases of inventories, and the backlog of work declined at a slower pace. 

Japan Indexes Stocks 

The Nikkei 225 Stock Average decreased 0.2% to 38,337.35, and the broader Topix index declined 0.3% to 2,761.99. 

Tokyo Electron decreased 1.1% to ¥23,705.0, Advantest Corp. dropped 1.2% to ¥9,710.0, and Disco Corp. fell 1.6% to ¥36,110.0. 

Seven & I Holdings rose 1% to ¥2,264.50, Fast Retailing Co. Ltd. edged up 0.7% to ¥46,360.0, Takashimaya Corp. declined 0.4% to ¥1,094.50, and Aeon Corp. fell 1.2% to ¥4,453.0. 

Nippon Yusen KK edged up 0.6% to ¥5,085.0, Mitsui O.S.K. Lines dropped 0.6% to ¥4,798.0, and Kawasaki Kisen Kaisha Ltd. added 0.8% to ¥2,039.0. 

China Indexes Eased After U.S. Strikes Iran's Nuclear Facilities

The Hang Seng index and the mainland-focused CSI 300 index declined a fraction in volatile trading, and crude oil prices rose about 2%. 

Risk appetite waned after the U.S. president said additional strikes targeting Iran's military and nuclear installations are likely, as the U.S. entered the war in the Middle East. 

Iran also threatens to close the Strait of Hormuz, which could curtail oil supply to global markets and stoke crude oil prices higher. 

Brent crude oil prices rose 5% to $81.67 a barrel before backing down to an increase of 2.2% to $78.91. 

Arab nations in the Middle East are bracing for a wider war in the region, which could severely disrupt energy supplies from the region and lead to a series of events with unpredictable outcomes. 

Closer to home, investors worried that higher energy prices could stoke global inflation and dampen demand for Chinese manufactured goods. 

China Indexes and Stocks 

The Hang Seng index edged lower 0.1% to 23,509.74, and the mainland-focused CSI 300 index decreased 0.2% to 3,838.86. 

Zhejiang Sanhua Intelligent Controls listed its stock on the Hong Kong Stock Exchange and traded down 2% to HK $22.05. 

The maker of parts for fridges and air conditioners raised HK$9.3 billion and priced its offering at HK$22.53. 

Bayzed Health Group soared 25% to HK$5.330, and the company, which operates hospitals, sold 133.1 million shares at HK$4.22 per share, raising a total of HK$561.7 million. 

Transthera Sciences soared 25% to HK $23.03, and the biopharmaceutical company sold 15.3 million shares and priced its offering at HK $13.15 per share. 

China Indexes Eased After U.S. Strikes Iran's Nuclear Facilities

The Hang Seng index and the mainland-focused CSI 300 index declined a fraction in volatile trading, and crude oil prices rose about 2%. 

Risk appetite waned after the U.S. president said additional strikes targeting Iran's military and nuclear installations are likely, as the U.S. entered the war in the Middle East. 

Iran also threatens to close the Strait of Hormuz, which could curtail oil supply to global markets and stoke crude oil prices higher. 

Brent crude oil prices rose 5% to $81.67 a barrel before backing down to an increase of 2.2% to $78.91. 

Arab nations in the Middle East are bracing for a wider war in the region, which could severely disrupt energy supplies from the region and lead to a series of events with unpredictable outcomes. 

Closer to home, investors worried that higher energy prices could stoke global inflation and dampen demand for Chinese manufactured goods. 

China Indexes and Stocks 

The Hang Seng index edged lower 0.1% to 23,509.74, and the mainland-focused CSI 300 index decreased 0.2% to 3,838.86. 

Zhejiang Sanhua Intelligent Controls listed its stock on the Hong Kong Stock Exchange and traded down 2% to HK $22.05. 

The maker of parts for fridges and air conditioners raised HK$9.3 billion and priced its offering at HK$22.53. 

Bayzed Health Group soared 25% to HK$5.330, and the company, which operates hospitals, sold 133.1 million shares at HK$4.22 per share, raising a total of HK$561.7 million. 

Transthera Sciences soared 25% to HK $23.03, and the biopharmaceutical company sold 15.3 million shares and priced its offering at HK $13.15 per share.