President Trump rejected Iran’s latest peace offer, while Tehran rebuffed U.S. demands including calls to dismantle its nuclear facilities, the Wall Street Journal reported, leaving the two sides deadlocked and diplomatic prospects dim.
A survey of economists now anticipates two ECB rate hikes in 2026 as the conflict in Iran lifts inflation expectations, adding pressure to fixed‑income markets already sensitive to geopolitical risk.
In Asia, Indian equities slid more than 1% after Prime Minister Narendra Modi urged citizens on television to refrain from buying gold for one year, a plea that hit demand for the traditional safe‑haven asset. Beijing confirmed President Trump will visit China on May 13 for a two‑day trip, a development that could reshape diplomatic dynamics if the trip goes ahead.
Market action has been mixed. The S&P 500 closed at another record last week after a 1.7% gain, but the Iran stalemate has pushed bond yields and oil higher while leaving equity benchmarks largely steady. European and Japanese markets fluctuated between small gains and losses; mainland China advanced about 1.6%. U.S. futures pointed to a modest decline, and Brent crude climbed roughly 2.5% to around $104 a barrel as investors priced in elevated geopolitical risk.
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