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Commerzbank Says Oil Prices Decline From Highs, Treasuries Supported, US Equity Futures Tad Higher

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Brent crude has come off its highs and is trading below $108 a barrel, according to a note from Commerzbank Research. Treasuries found stronger support in Asian trading on Wednesday, with 10-year yields falling below 5%.

US Vice President JD Vance said the war with Iran could enter a new phase after the midterm elections in November if President Donald Trump decides not to escalate further, wrote Commerzbank.

The US is considering a ban on diesel exports, added the bank.

The United States and China are considering tariff cuts ahead of next week's meeting between President Trump and President Xi Jinping, said Commerzbank.

US equity futures are moderately higher.

In Europe, France would back Klaas Knot for European Central Bank president if a French candidate were appointed to the chief economist role, according to Reuters sources.

France's central bank lowered its 2026 growth forecast to 0.4%, from 0.5% in June.

German Prime Minister Friedrich Merz has cancelled his trip to the United Nations in New York and scheduled a CDU Presidium meeting for Sunday to discuss the disappointing regional election results and their implications, said Commerzbank.

What else is happening in Sectors?

Sectors

Sector Update: Energy Stocks Gain Late Afternoon

Energy stocks were higher late Tuesday afternoon, with the NYSE Energy Sector Index and the State Street Energy Select Sector SPDR ETF (XLE) each adding 2%.The Philadelphia Oil Service Sector Index was rising 1.9%, and the Dow Jones US Utilities Index was down 0.9%.Front-month West Texas Intermediate crude oil jumped 4.2% to $105.67 a barrel, and the global benchmark Brent crude contract added 2.7% to $108.51 a barrel. Henry Hub natural gas futures increased 1% to $2.93 per 1 million BTU.Crude oil prices jumped as a Tehran-aligned militia group continues to pull Saudi Arabia into the Iran war. Yemen's Iran-aligned Houthis launched a new wave of attacks on Saudi Arabia and were digging into positions on the western coast of Yemen along the Red Sea, Yemeni officials said, as urgent deliberations took place in Riyadh over how to respond to their advance, according to a Reuters report.Iran's semi-official Fars news agency reported that the Iran Revolutionary Guards Corps has shot down another US-developed MQ-1 drone over Hormuz, Al Jazeera, a Middle Eastern broadcaster, said. This is the third such drone downed in the area on Tuesday, the report said, citing the IRGC.In corporate news, TXNM Energy (TXNM) and Blackstone's (BX) Blackstone Infrastructure have filed a motion with the New Mexico Public Regulation Commission seeking authorization to submit a revised version of their merger application, TXNM said Tuesday. The motion included a draft of the revised application that would provide $300 million in benefits for customers and communities as part of Blackstone's proposed acquisition of TXNM, according to a statement. TXNM shares were up 1%.An ExxonMobil (XOM) executive said disruptions and shortages of liquefied natural gas supplies from the Middle East are expected to be short-term, Reuters reported Tuesday. Andrew Barry, chairman of LNG market development at ExxonMobil, said at an industry event in Thailand that the company views the current disruptions as temporary, while underscoring the region's long-term importance, according to the report. ExxonMobil shares were up 2.3%.Borr Drilling (BORR) shares jumped nearly 6% after the company said it has agreed to divest its 51% interest in two oil-drilling Mexican joint ventures to its partner in Mexico.Shell (SHEL) has started production at its new grease manufacturing plant in Indonesia with a capacity of up to 12 kilotonnes per year, the company said Tuesday. Shell shares rose 2.6%

$BORR$SHEL$TXNM$XOM
Sectors

Sector Update: Financial Stocks Decline Late Afternoon

Financial stocks were lower in late Tuesday afternoon trading, with the NYSE Financial Index decreasing 0.5% and the State Street Financial Select Sector SPDR ETF (XLF) shedding 0.3%.The Philadelphia Housing Index was down 0.2%, and the State Street Real Estate Select Sector SPDR ETF (XLRE) was easing 0.1%.Bitcoin (BTC-USD) was falling 2.8% to $75,953, and the yield for 10-year US Treasuries rose 3.5 basis points to 4.996%.In economic news, the US Federal Reserve kicked off its two-day monetary policy meeting on Tuesday. Ahead of the rate decision on Wednesday, traders are now pricing in a 95% probability that the central bank will raise its target rate by 25 basis points, up from 33% a month ago, according to the CME FedWatch tool.In corporate news, Goldman Sachs' (GS) asset management alternatives unit has raised $11.7 billion across its newest private equity funds and other vehicles, Reuters reported, citing a statement and an interview with an executive. The fundraising included $9.6 billion for its West Street Capital Partners IX fund, $1.6 billion for its West Street Asia Equity Partners I, and $500 million for related vehicles, Reuters reported. Goldman shares fell 1.4%.Carlyle (CG) has joined a Massachusetts Institute of Technology research consortium for a two-year program examining how AI can be applied to portfolio management and investment decision making, Bloomberg reported. Carlyle shares were down 1.3%.Truist Financial (TFC) said Tuesday it agreed to sell $5.5 billion of auto loans representing substantially all the assets of its Regional Acceptance unit. The buyer is Apollo Global Management (APO), Bloomberg reported. Truist shares were up 0.7%, and Apollo was shedding 1.2%.Two Robinhood (HOOD) engineers were charged with commodities fraud and wire fraud, US Attorney for the Southern District of New York Jamie McDonald and FBI New York Field Office Assistant Director James Barnacle, Jr. said Tuesday. The two engineers, Hefu Chai and Huaisong Xiang, allegedly participated in a scheme to misappropriate confidential business information from Robinhood to trade perpetual futures on a decentralized derivatives exchange, the officials said. Robinhood shares were down 4%.

$APO$CG$GS$HOOD$TFC
Sectors

Sector Update: Tech Stocks Mixed Late Afternoon

Tech stocks were mixed late Tuesday afternoon, with the State Street Technology Select Sector SPDR ETF (XLK) decreasing 0.4% and the State Street SPDR S&P Semiconductor ETF (XSD) adding 1.2%.The Philadelphia Semiconductor index was up 0.3%.In corporate news, Amazon's (AMZN) Amazon Web Services said Tuesday it is unable to restore access to data at some sites in the Middle East due to the ongoing conflict in the region. Amazon shares were down 2.4%.Axon Enterprise (AXON) shares fell nearly 10% after the company said it plans to offer $1 billion of 0% convertible senior notes due 2031 in a registered public offering.Waystar (WAY) is seeking options including a potential sale, Reuters reported. The healthcare software company has hired Evercore (EVR) to advise on the process, the report said. Waystar shares jumped 7.4%.Meta Platforms (META) is planning to start deploying a new in-house AI chip in data centers in H1 2027, a step expected to reduce costs and energy use, Bloomberg reported, citing an interview with Yee Jiun Song, vice president of engineering. Meta shares added 0.6%.

$AMZN$AXON$META$WAY