Futures are all lower but already about 100bps higher than overnight lows with all eyes on geopolitical tension in the Middle East after Israel effectively started war with Iran, sending the VIX up to a 20-handle and Gold re-testing ATHs. As of 8:00am, SPX futures are down -90 bps, and trading just under 6,000; Nasdaq 100 futs are down 110 bps with all Mag 7 stocks trading lower (TSLA -2.8%, NVDA -2.0%, GOOG/L -2.0% lagging) and small caps -140 bps Global indices lower, though not dramatically so, with Asia market down ~75 bps overnight and Europe down 100-150 bps at the moment. Dubai/Abu Dhabi markets were down 3/4%. Overnight, the major headlines were Israel’s wide-ranging attack on Iran’s nuclear program and military leadership. Oil up sharply to ~$75 but also well off session highs as so far the initial Israeli attack has avoided energy targets, but Israel could extend over several days, with Iran vowing to retaliate. Also it is unclear if Iran will be allowed to continue smuggling oil to China after this escalation. Crude is up 7.8% from yesterday’s close having surged as high as 13% earlier – its biggest jump in 3 years – and with all CTAs still 100% short this may just be the start of the squeeze. Gold added +0.9%. Yields are mostly unchanged; USD is higher. US economic data slate includes June preliminary University of Michigan sentiment at 10am; Fed officials are in external communications blackout period ahead of June 18 rate decision.

In premarket trading, magnificent Seven stocks are lower as as investors rotate out of equities and into haven assets (Tesla -1.6%, Amazon -1.9%, Meta Platforms -1.5%, Nvidia -1.5%, Alphabet -2%, Microsoft -0.8%, Apple -0.2%). Energy and defense stocks rise after Israel’s airstrikes against Iran (Exxon Mobil +3.3%, Chevron +2.6%, Occidental Petroleum +5.5%; RTX +5.5%, Lockheed Martin +4.8%). Airline and travel stocks slide following Israel’s predawn attacks. Here are some other notable premarket movers:

• Delta Air Lines -4.4%, United Airlines (UAL) -5%, American Airlines (AAL) -4%
• Royal Caribbean Cruises -3.7%, Carnival Corp -5.5% and Norwegian Cruise -4%
• Adobe slips 3% after the company gave a sales outlook for the current quarter that topped analysts’ estimates, but investors remain skeptical that the leader in creative software can outduel AI-focused upstarts.
• RH jumps 19% after the luxury furniture company reported adjusted earnings per share for the first quarter that beat the average analyst estimate. Analysts note that the unchanged full-year guidance is a positive sign for demand from upscale consumers.
• Visa falls 2.7% and Mastercard (MA) declines 2.4% as the Wall Street Journal reports that large merchants, including Walmart and Amazon, are exploring how to issue or use stablecoins to bypass traditional fees of the card-based systems.
• US Steel falls 4% after Nikkei reported that Nippon Steel’s planned takeover of the US company may not proceed if the Japanese company has insufficient freedom of management.

It’s shaping up as an extremely busy Friday for traders assessing market risks going into the weekend. Stock futures are down and oil jumped the most in three years after Israel’s strikes on Iran. Havens, and especially gold, are in demand. 

The airstrikes against Iran’s nuclear program and ballistic-missile sites renewed a standoff between two adversaries that risks spiraling into a wider conflict. While the reaction was strongest in crude oil, other pockets of the market suggested that investors are watching how long the tensions will last and whether the situation escalates. Netanyahu said the attacks targeted Tehran’s nuclear program and military, and would last until the threat was removed. Iran vowed to retaliate against Israel and, possibly, US assets in the Middle East even as Trump urged Iran to make a deal “before it is too late.”

The strikes follow repeated warnings by Israeli Prime Minister Benjamin Netanyahu to cripple Iran’s nuclear program. Iran had previously said it would inaugurate a new uranium-enrichment facility in response to censure by the UN atomic watchdog over its nuclear program. 

“We are seeing behavior fully consistent with risk-off,” said Geoff Yu, FX and macro strategist at Bank of New York Mellon Corp. “This is probably the starting point for markets, but as we know correlations have been variable in recent weeks and much will depend on the reaction of Iran, the US and others.”

“Short term it will be used as an excuse or a catalyst by investors for some profit taking, after a very strong comeback of risk assets,” said Vincent Mortier, chief investment officer at Amundi SA. “Price reaction of historical safe havens has been minimal. We believe the events of last night will remain localized and will not degenerate into something more global.”

The attacks are coming at a time when equity markets had recovered from a slump in April that was caused by US President Donald Trump’s tariff war. An index of global stocks touched a record Thursday, gaining more than 20% from a low hit in April. Any persistent gain in oil prices could fuel inflation, adding to the challenges confronting the Fed and other central banks as policymakers also contend with the repercussions of Trump’s trade war. For now, changes in the prices of crude futures point to fears of a drawn-out conflict.

“This goes against what central banks were expecting for oil prices and could potentially change their scenario by heating up inflation and slowing growth,” said Alexandre Hezez, chief investment officer at Group Richelieu.

Meanwhile, US stock funds just suffered the biggest outflows in almost three months, according to data published by BofA’s Michael Hartnett, citing EPFR Global data, another sign the rally may be stalling. About $9.8 billion was redeemed from US stocks in the week through Wednesday, the most in 11 weeks. Mideast conflict also risks upending the S&P’s quick-fire comeback from April’s tariff fallout. Bloomberg Intelligence wrote earlier that a return by the benchmark to its former peaks within the next few weeks would mark the fastest recovery from a decline of more than 15% since at least 1980.

European equities fall, with Israel’s military strikes against Iran’s nuclear program spurring big moves across energy and airline stocks, which are most sensitive to oil’s price jump. The Stoxx 600 falls 0.8%, with travel, auto and consumer products leading declines. Among single stocks, Novo Nordisk overtakes SAP to reclaim its position as Europe’s most valuable public company. Novo shares are lifted by its plans to advance an experimental weight management treatment amycretin into late-stage development. Here are the most notable movers: 

• Energy stocks are pushing higher following a surge in oil prices after Israel mounted waves of air strikes against Iran.
• BAE Systems and other defense suppliers move higher as the tensions spur predictions of elevated military sending.
• Novo Nordisk shares climb as much as 2.3%. The firm plans to advance its experimental weight management treatment amycretin into late-stage development following feedback from regulatory authorities.
• Intrum shares gain as much as 2.4% after the credit management services firm was upgraded to neutral from underweight at JPMorgan. Analysts note better profitability in Servicing.
• Airline stocks are the worst performers following a surge in oil prices after Israel mounted waves of air strikes against Iran, spurring concern around jet fuel costs.
• Burberry, Hugo Boss and other luxury stocks slip due to concerns around reduced demand from travelers.
• Soitec shares slide as much as 5.7%. The chip wafer maker is cut to hold at Jefferies as analysts don’t expect a near-term cyclical upturn.
• Mitie shares fall as much as 3%. The building maintenance services firm is downgraded to hold at Jefferies as analysts see insufficient upside to maintain a buy rating, noting that shares are up about 30% year-to-date.
• Clas Ohlson shares drop as much as 7.2%, retreating from an all-time high on Thursday. Kepler Cheuvreux downgraded the retailer, saying its valuation looks full and that there is a risk of tougher conditions going forward.
• PGE shares drop as much as 6.3%, most in nearly two months, as its new strategy envisages $64 billion in capex by 2035 without clarifying when Poland’s biggest utility will return to paying dividends.

Stocks in Asia dropped amid rising risk-off sentiment following Israel’s attacks on Iran’s military facilities, which can potentially spark a wider war in the Middle East. The MSCI Asia Pacific Index extended its loss to 1.2% in the afternoon session, the most in nearly two months. Most major markets were in the red, with Japan and Hong Kong leading the declines. TSMC, Alibaba and Samsung Electronics were among the stocks that weighed the most on the regional gauge. “This morning’s alarming escalation is a blow to risk sentiment and comes at a crucial time after macro and systematic funds have rebuilt long positions and investor sentiment has rebounded to bullish levels,” said Tony Sycamore, market analyst at IG Australia. “We are likely to see a further deterioration in risk sentiment as traders cut risk seeking positions ahead of the weekend.

In FX, the dollar rebounded 0.5% from Thursday’s three-year low as the Bloomberg Dollar Spot Index rises 0.4% as the greenback strengthens against all its G-10 peers. The haven yen and Swiss franc initially rise on news of the attack, only to reverse those gains in London trade; USD/JPY and USD/CHF both rise 0.3.  Higher-risk currencies suffer the most, with the Australian and New Zealand dollars both falling roughly 1% versus the greenback. Knee-jerk reaction to risk-off news points to haven dynamics for the dollar, yet positioning and profit-taking on shorts ahead of the weekend need to be taken into account, as well as the boost to the greenback from higher oil prices

In rates, treasury futures turn lower into early US session, unwinding an overnight flight-to-quality bid after Israel launched airstrikes on Iran’s nuclear and ballistic missile programs, sending oil futures higher. Treasury yields higher by a couple of basis points across maturities with curve spreads little changed. 10-year is around 4.38% with UK counterpart cheaper by an additional 3.5bp, leading losses among European peers. Gilts underperform, along with most European bonds, after German and French CPI data. WTI crude futures remain more than 8% higher on the day. 

In commodities, brent crude gained 7.6%, having earlier surged as much as 13% in the biggest intraday jump since March 2022. Gold rose 1% to the highest in more than a month. 

Looking to the day ahead now, and data releases from the US include the University of Michigan’s preliminary consumer sentiment index for June, and in the Euro Area we’ll get industrial production for April. Central bank speakers include the ECB’s Escriva

Market Snapshot

• S&P 500 mini -1.2%
• Nasdaq 100 mini -1.5%
• Russell 2000 mini -1.7%
• Stoxx Europe 600 -0.9%
• DAX -1.4%, CAC 40 -1.1%
• 10-year Treasury yield -2 basis points at 4.34%
• VIX +3.1 points at 21.12
• Bloomberg Dollar Index +0.4% at 1204.54
• euro -0.5% at $1.1528
• WTI crude +7.6% at $73.22/barrel

Top Overnight News

• Israel launched waves of airstrikes against Iran’s nuclear program and ballistic-missile sites, killing the head of the Islamic Revolutionary Guard Corps and the military’s chief of staff. Oil surged as much as 13% as PM Benjamin Netanyahu pledged more attacks to come. Iran vowed to retaliate, sending drones that were intercepted. BBG
• Donald Trump can continue to use troops to deal with LA protests, an appeals court ruled, hours after a judge said the federal government must cease these efforts and return National Guard control to California state leaders. The court set a hearing Tuesday to discuss further action. BBG
• The case for a Fed rate cut is growing stronger as inflation stays muted despite tariffs while signs of deterioration emerge in the labor market (the Fed won’t cut next week, but the forward guidance language could evolve in a dovish direction). WSJ
• Japan’s top trade negotiator expects a trade deal with the US to spare Tokyo from higher auto tariffs, even if Trump increases them against other nations. BBG
• Nearly all the iPhones exported by Foxconn from India went to the United States between March and May, customs data showed, far above the 2024 average of 50% and a clear sign of Apple’s efforts to bypass high U.S. tariffs imposed on China. Apple is also reportedly targeting spring of 2026 for delayed upgrade of Siri. RTRS
• China is saddled with the most loss-making industrial companies since 2001, leaving the government grappling with conflicting goals: closing enterprises while also trying to avoid mass unemployment. BBG
• Bank of Japan officials see prices rising a little stronger than they expected earlier in the year, a factor that may open the door to discussions over whether to raise interest rates if global trade tensions ease. BBG
• UK employers scaled back hiring further in May in the wake of the sharp tax increases and the global trade war, a REC and KPMG survey showed. BBG
• Meta finalized an investment in Scale AI that was said to be $14.3 billion. BBG

Tariffs/Trade

• US Commerce Secretary Lutnick said the China tariff pause likely won’t be extended and its best chips were never on the table and won’t be regarding the China deal.
• US Commerce Department made steel derivatives products subject to additional tariffs, according to the Federal Register.
• US eyes a plan to use the Defense Production Act for rare earths, although a timeline for the Trump rare earth initiative is unclear, according to Bloomberg citing sources.
• China reportedly delayed approval of the USD 35bln merger between Synopsys (SNPS) and Ansys (ANSS) amid Trump’s trade war, according to FT.
• Japanese PM Ishiba will hold talks with US President Trump on Friday, via NHK.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded lower and US equity futures were pressured amid the worsening geopolitical situation in the Middle East after Israel conducted pre-emptive strikes on Iranian nuclear and military targets, with the Israeli military said to have struck dozens of sites across Iran, while Israeli PM Netanyahu said the operation will last for as many days as it takes and Iran has warned that Israel and the US will pay a heavy price for the Israeli attack. ASX 200 was dragged lower by losses in cyclicals but with the downside stemmed as energy and gold miners benefitted from the geopolitical-fuelled upside in the respective underlying commodity prices. Nikkei 225 slipped beneath the 38,000 level after recent currency strength and heightened geopolitical tensions. Hang Seng and Shanghai Comp conformed to the negative mood as Israel’s numerous strikes and Iran’s retaliation threats dominated the headlines.

Top Asian news

• BoJ officials see prices rising a little stronger than they expected earlier in the year and expect the interest rate to be maintained at 0.5% next week, according to Bloomberg.

European bourses are in the red, Euro Stoxx 50 -1.4%, given the dour risk sentiment, which has been triggered by events in the Middle East. Energy (+1.0%) is the only sector in the green, given the surge in benchmark prices. Defence names also faring well, the two together causing the FTSE 100 -0.3% to be the relative outperformer. Conversely, energy strength is weighing on Travel & Leisure (-2.5%) while Auto (-2.2%) names have been hit by Trump’s comments on tariffs potentially going up.

Top European news

• IFS’ Johnson has warned that UK Chancellor Reeves is a “gnat’s whisker” away from having to raise taxes in the autumn budget despite the chancellor insisting her plans are “fully funded”, according to Sky News.
• Bank of England/Ipsos Inflation Attitudes Survey, May 2025: Median expectations of the rate of inflation over the coming year were 3.2%, down from 3.4% in February 2025.

FX

• DXY on the front foot with USD benefiting from its status as a safe-haven currency. Ventured as high as 98.39 but has stopped shy of yesterday’s best @ 98.51.
• GBP pressured against the USD but flat vs the EUR. Action dictated by the USD, hence why EUR/GBP is near-enough unchanged, while Cable itself has pulled back from the overnight multi-year high at 1.3632, as low as 1.3522.
• EUR under similar pressure against the USD. The single currency down to a 1.1513 base, though someway clear of Thursday’s 1.1487 base. As above, price action dictated by geopols and the USD, remains to be seen if the energy moves move the inflation outlook and provide some ammo for the ECB’s hawkish contingent.
• JPY is, somewhat surprisingly, softer against the USD despite the risk-aversion seen across global markets. Overnight, USD/JPY trickled lower and briefly dipped beneath the 143.00 level owing to the haven flows into yen but later rebounded above 144.00 to a current 144.16 high.
• Antipodeans trade in-line with the risk tone and have been hit hard, residing at the trough of the G10 leaderboard. AUD/USD at a 0.6457 base and NZD/USD down to a test of 0.60.

Fixed Income

• Broadly, fixed benchmarks were propelled to WTD peaks overnight/this morning as Israel struck Iranian facilities. Since, the move has pared and we reside in Thursday’s parameters as the intensity of geopolitical news slows slightly and we await updates from Iran.
• USTs peaked at 111-13 overnight, a new WTD high and just a tick+ shy of last week’s 111-14+ best. Since, the benchmark has pared and is near-enough unchanged, holding just below Thursday’s 111-06 peak.
• Bunds bid given the above. Hit a 131.95 peak, marking a new WTD high. A move that occurred given the risk-off action sparked by Israel striking Iran’s facilities and the associated FTQ that ensued. In-line with USTs, EGBs have pulled back markedly from the above peak and currently reside just in the red and 20 to 30 ticks below Thursday’s best; for Bunds, this has the benchmark holding around 131.20.
• The German 10yr yield fell by around 5bps to a 2.42% low when Bunds hit their WTD peak. Since, the 10yr has retraced the move and is now higher by just over a bps on the session, probing 2.50% to the upside.
• Gilts hit a 93.68 peak when trade resumed this morning, gapping higher by 37 ticks and then extending another 10 to that high and eclipsing Thursday’s 93.55 best in the process. However, this proved short-lived as fixed benchmarks generally were already paring back much of their overnight gains and this pressure began to make itself known in Gilts within minutes of the open. Now, holding a few ticks above a 92.94 trough and by extension above Thursday’s 92.80 low.

Commodities

• Session dominated by geopolitics; see the Geopolitics section below and/or headline feed for full details. Brent hit a USD 78.50/bbl high overnight, WTI got to USD 77.62/bbl.
• In brief, Israel’s operation, dubbed “Rising Lion”, targeted a number of nuclear and military targets. The head of IRCG, Hossein Salami, and nuclear scientist Abbasi, have been killed. Iran’s Natanz enrichment site has been impacted. In response, Iran vowed to retaliate, noting also the US would pay a heavy price “now that Israel has crossed all red lines, Iran sees no limits to respond to this crime.”, a state of emergency has been declared in Israel. US said they were not involved in the action.
• Throughout the European morning, while still markedly firmer, benchmarks pulled back from highs as participants faded the initial move and awaited fresh updates. A move that took WTI and Brent as low as USD 71.00/bbl and USD 72.10/bbl.
• Thereafter, a bout of fresh upside occurred (within overnight ranges) as Tass cited remarks from the Israeli PM’s office that they are prepared for the possibility of full-fledged war with Iran. This lifted the benchmarks towards current levels above USD 73.15/bbl and USD 74.50/bbl for WTI and Brent respectively.
• More recently, Trump has commented “Iran must make a deal, before there is nothing left…”; no significant move to this.
• Ahead, further potential catalysts for crude include Iranian retaliation, Strait of Hormuz activity, indications of US involvement (US Security Council meeting at 16:00 BST), and the length of the Israeli operation.
• European gas prices bolstered given the above, Dutch TTF firmer by over EUR 1.50/MWh at best; most recently, Israel’s Energy Minister says they may order temporary shutdown to Natgas reservoirs; due to security situation.
• Spot gold firmer given its haven status and the FTQ. However, upside is being capped by the markedly firmer USD. Leaving XAU at a USD 3444/oz peak, with the ATH at USD 3500/oz the next point of focus.
• Base metals in the red, given the risk off tone and strong USD. 3M LME Copper lower by near-enough 1%, hit a trough at USD 9.57k/T before.

Geopolitics

• Israel’s military struck nuclear and military targets in Iran as well as dozens of sites and said the Iranian nuclear programme is an existential threat to Israel, while it said the Iranian regime is advancing a secret program to build a nuclear weapon and Iran has enough fusion material to make 15 nuclear bombs within days.
• Israeli PM Netanyahu said their pilots were striking many targets in Iran and that the operation would continue for as many days as it takes which will hurt Iran’s nuclear infrastructure, ballistic missile factories and military capabilities. Netanyahu also said they struck at the heart of Iran’s nuclear enrichment programme and nuclear weaponisation programme, as well as Iran’s main enrichment facility in Natanz. Furthermore, he said they targeted Iran’s leading nuclear scientists working on the Iranian bomb and he later declared that they delivered a successful opening strike.
• Israeli Defence Minister Katz declared a special state of emergency on the home front throughout the entire state of Israel and said following Israel’s pre-emptive strike against Iran, that a missile and drone attack against Israel is expected in the immediate future. It was separately reported that two Israeli officials said Israel is bracing for an Iranian response in the coming hours and the Iranian response could include the launch of hundreds of ballistic missiles.
• Iran’s Supreme Leader Khamenei said Israel will receive a harsh punishment and that Israel “unleashed its wicked and bloody” hand in a crime against Iran, while he added that several commanders and several scientists were “martyred” and with this attack, Israel has prepared a bitter fate for itself, which it will surely receive.
• Iran Revolutionary Guards said Israel will pay a heavy price for the killing of IRGC Chief Commander Salami and that the attack was carried out with full knowledge and support of ‘wicked rulers in the White House and terrorist US regime’, while it was also reported that supreme leader advisor and IRGC commander Shamkhani was critically injured and that the head of Iran’s armed force Bagheri was killed in the Israeli attack.
• Iran’s Foreign Ministry said responding to Israel is its right under international law, and the US as Israel’s main supporter will be responsible for the consequences of Israel’s adventurism, while Iran’s armed forces spokesman earlier warned that Israel and the US will pay a heavy price for the Israeli attack.
• US Secretary of State Rubio said Israel took unilateral action against Iran and the US is not involved in strikes against Iran, while he added the top priority is protecting American forces in the region and that Iran should not target US interests or personnel.
• US officials said they still intend to have talks on Sunday between US and Iran envoys.
• US reportedly told Israel it won’t be directly involved in any strike on Iran, according to Axios.
• UN General Assembly demanded an immediate, unconditional and permanent ceasefire in Gaza, while it adopted the Gaza resolution with 149 votes in favour.
• National Iranian Oil Refining and Distribution Company says refining facilities and oil storage did not sustain damage in the Israeli attack.
• Israel’s Ambassador to France says the operation against Iran can continue for a few days, not months. Have already destroyed parts of the Iranian nuclear programme.
• Israeli officials report “The assumption is that additional senior officials in Iran have been eliminated, whose deaths have not yet been publicly disclosed.”, via journalist Stein.
• Israel’s air force has begun to intercept drones over the “skies of Saudi Arabia”, via Channel 12.
• Mossad and the Israeli military led a series of covert operations against the Iranian strategic missile array, according to Reuters citing an Israeli security source; Israel deployed precision guided weapons in open areas near Iranian surface-to-air missile systems sites. Thereafter, Israeli Military says it completed a large-scale strike against the aerial defense array of Iran, according to Reuters.
• Israel is prepared for the possibility of a full-fledged war with Iran, according to PM Netanyahu’s office via Tass.
• Israel Defence Minister Katz says the assessment is that most leadership of the Iranian IRGC Air Force were eliminated in a strike.
• Israeli Military says it is prepared for this (i.e. action against Iran) to keep going on for days; depends partly on Iranian response. Already achieved a lot, assessments continue. Still trying to determine how things went. Iran has sent over 100 drones to Israel, many already intercepted.
• Iran’s Abadan oil refinery Co. says they are producing and providing services at full capacity, no disruption.
• Iran’s Armed Forces reportedly says “now that Israel has crossed all red lines, Iran sees no limits to respond to this crime.”, via journalist Aslani.
• Iran’s Atomic Energy Organisation says damage occurred at the Natanz enrichment facility; no chemical or radioactive contamination shown.
• IAEA Statement: “the competent Iranian authorities have confirmed that the Natanz enrichment site has been impacted and that there are no elevated radiation levels.”.
• IAEA says, as it stands, the Fordow fuel enrichment plant has not been impacted; Isfahan nuclear site has not been impacted.
• Iranian Supreme Leader Khamenei appoints Mohammad Pakpour as the new IRGC Commander, after Salami was killed by an Israeli strike; Pakpour directed to “enhance the IRGC’s capabilities, readiness, and internal cohesion.”.
• Iran’s Fars News reports renewed strike by Israel on north-western city of Tabriz.
• Iranian President will deliver a speech soon, according to an X post. [posted around 10:15BST/05:15ET]
• Iran has requested a special session of the (IAEA) “board of governors” on Monday, via Jerusalem Post citing sources.

Geopolitics: Other

• The sixth round of (Nuclear) negotiations will not be held due to Israeli attacks, according to the Tehran Times.
• Frontline is “far more hesitant” about offering its craft to move cargo from the Persian Gulf after the Israeli strikes on Iran, via Bloomberg.
• Iraq’s gas supply from Iran not affected by the Israeli attack, according to Iraqi state news.
• Lebanon’s Hezbollah says the group will not initiate an attack on Israel in response to strikes on Iran.
• US President Trump posts on Truth “I gave Iran chance after chance to make a deal” and “Iran must make a deal, before there is nothing left, and save what was once known as the Iranian Empire”.

US Event Calendar

• 10:00 am: Jun P U. of Mich. Sentiment, est. 53.6, prior 52.2

DB’s Jim Reid concludes the overnight wrap

As we go to press, there’ve been huge developments in the Middle East overnight, as Israel has carried out air strikes against Iran’s nuclear and military facilities. We still await further details, but press reports have said that explosions were heard in Tehran and Natanz, which is where one of Iran’s nuclear plants is. Iranian state TV has reported that Hossein Salami, the head of the Revolutionary Guards, was killed, along with armed forces chief of staff Mohammad Bagheri. Israeli PM Netanyahu has said the operation “will continue for as many days as it takes to remove this threat”, although US Secretary of State Marco Rubio has said the US weren’t involved in the strikes.

The news has led to significant fears about an escalation and a wider regional conflict. For instance, Iran’s armed forces spokesperson said that Israel and the US will receive a “harsh blow” in response, and Iran’s Supreme Leader said Israel “should expect a severe punishment”. In turn, oil prices have surged on the news, with Brent crude up +9.00% this morning to $75.60/bbl. If sustained, that would be the biggest daily jump in oil prices since May 2020, as the global economy was recovering from the Covid lockdowns. And that’s slightly down from the overnight peak, when prices reached $78.50/bbl.

The effects of the attack have cascaded across global markets, with a strong risk-off move for several asset classes. Equities have slumped, with S&P 500 futures down -1.65% this morning, whilst those on the German DAX are down -1.65% as well. Meanwhile, gold prices have surged, moving up +1.26% to $3,428/oz. US Treasuries have also seen a fresh rally this morning, with the 10yr yield down another -1.4bps to 4.35%, its lowest in the last month. And the dollar index (+0.36%) has stabilised after closing at a 3-year low yesterday.

Looking forward, the focus is now shifting to what form Iran’s retaliation might take. It’s also unclear whether talks between the US and Iran over their nuclear programme will continue, although AFP reported that the US still wanted to hold talks this Sunday. We haven’t yet heard from President Trump directly, although his public schedule says he’ll be attending a National Security Council meeting in the Situation Room at 11am ET.

The reaction has been clear in Asian markets overnight as well, where all of the major indices have lost ground in response. That includes the Nikkei (-1.25%), the KOSPI (-1.29%), the Hang Seng (-0.70%), the CSI 300 (-0.76%) and the Shanghai Comp (-0.72%). Similarly, sovereign bonds have rallied, with Japan’s 10yr yield down -3.5bps, and Australia’s down -6.3bps.

Before the strikes, markets had put in a steady performance yesterday. Admittedly, there had been speculation about a strike, with Trump himself saying “Look, there’s a chance of massive conflict”, whilst ABC News reported that Israel was considering military action against Iran. However, there had been hopes that this could be a pressure tactic before planned US-Iran talks over the weekend, and US bonds and equities both advanced.

The bond rally was driven by a dovish batch of US data, including a softer-than-expected PPI reading. So that added to investors’ confidence that the Fed would still cut rates this year, which pushed Treasury yields lower, and meant the dollar index (-0.72%) hit a three-year low. Geopolitical concerns added to the bond rally, but risk assets put in a decent session too, aided by the prospect of rate cuts and the fact that lower yields helped to ease fears around the fiscal situation. So the S&P 500 (+0.38%) still reached a three-month high, closing just -1.61% beneath its all-time peak from mid-February.

The US PPI reading for May was the main driver of yesterday’s rally, as it added to the view that the tariff passthrough was smaller than expected, and wasn’t creating a big spike in inflation. Now, we should add the caveat that we wouldn’t expect the full tariff impact to be evident in the May data, and plenty of tariffs have since risen further (like on steel and aluminium). But the fact that inflation has been pretty soft so far is adding to investor confidence that the inflationary impact won’t be as big as feared. For example, monthly headline PPI was up just +0.1% in May (vs. +0.2% expected), whilst core PPI only rose +0.1% as well (vs. +0.3% expected).

That soft inflation print led to mounting anticipation that the Fed would cut rates in the months ahead, not least given the lower-than-expected CPI number the previous day. Moreover, the weekly jobless claims were also higher-than-expected yesterday, so that created a bit of nervousness about the state of the labour market, and helped to support the rate cut narrative. In fact, the continuing jobless claims moved up to their highest level since late-2021, at 1.956m in the week ending May 31 (vs. 1.910m expected). The initial claims have also been moving higher in recent weeks, and the 4-week average now stands at 240.25k for the week ending June 7, the highest since August 2023.

Given all that, futures priced in more rate cuts from the Fed yesterday, with 52bps of cuts now expected by the December meeting, up +2.9bps on the day. The overnight news has seen that move further, with 55bps priced in this morning. So that led to a significant rally for Treasuries as well yesterday, with the 10yr yield (-6.1bps) falling to 4.36%, whilst the 30yr yield (-7.6bps) hit a one-month low of 4.84%. Matters were helped by a solid 30yr auction, which went smoothly despite recent concern about demand for long-end bonds. And in turn, the decline in yields meant the dollar index hit a three-year low yesterday, whilst the Euro moved above $1.16 intraday for the first time since 2021.

Other notable news yesterday included Trump repeating his criticism of Fed Chair Powell, adding that he may “have to force something” if the Fed does not lower rates. In comments at the White House, Trump also said he might want to raise auto tariffs further from their 25% level “in the not too distant future”. Auto stocks struggled following the comment, with Ford (-1.22%), GM (-1.22%) and Stellantis (-1.84%) all falling back. And in other trade news, Bessent commented that the EU had been “very intractable” in talks.

Despite the geopolitical fears and the softer data, US equities had managed to put in a decent performance yesterday as the decline in yields proved supportive. For instance, the S&P 500 (+0.38%) posted a moderate advance, as did the NASDAQ (+0.24%). The Mag-7 (-0.005%) saw mixed moves, with Tesla (-2.24%) falling back but Nvidia outperforming (+1.52%) and Microsoft (+1.32%) reaching a new record high. The mood for AI-linked stocks was helped by Oracle (+13.31%) projecting very strong growth in its cloud infrastructure business. However, it wasn’t all good news, with the small-cap Russell 2000 (-0.38%) falling back.

Earlier in Europe, markets put in a much weaker performance, with the STOXX 600 (-0.33%) posting a 4th consecutive decline. Matters weren’t helped by some weak growth data in the UK, with monthly GDP contracting by -0.3% in April (vs. -0.1% expected). There was also a clear tariff impact, as the export of goods to the US fell by £2.0bn in April. The weak growth figures meant investors priced in more rate cuts from the Bank of England, and gilts outperformed their counterparts elsewhere, with the 10yr yield down -7.6bps on the day. But bonds still rallied across the continent, with yields on 10yr bunds (-6.1bps), OATs (-4.5ps) and BTPs (-4.1bps) all moving lower.

To the day ahead now, and data releases from the US include the University of Michigan’s preliminary consumer sentiment index for June, and in the Euro Area we’ll get industrial production for April. Central bank speakers include the ECB’s Escriva

By Ethan Howland of UtilityDive

The Environmental Protection Agency on Wednesday proposed eliminating greenhouse gas emissions limits for power plants as well as repealing a toughening of the mercury and air toxics standard for coal- and oil-fired generators.

“These Biden-era regulations have imposed massive costs on coal-, oil-, and gas-fired power plants, raising the cost of living for American families, imperiling the reliability of our electric grid, and limiting American energy prosperity,” the EPA said in a press release.

The EPA estimates that its proposal to repeal Obama and Biden era GHG rules would save the power sector $19 billion over 20 years and reverting to the 2012 MATS rule would save $1.2 billion over a decade.

Cooperative utilities, independent power producers, the National Mining Association and others praised the EPA’s decision.

“Besides being illegal, this Biden-era [GHG] rule would have shut down the nation’s fleet of coal power plants despite warnings from experts and officials that more than half of the U.S. is at risk of electricity shortages,” said Michelle Bloodworth, CEO of America’s Power, a trade group for coal-fired power plant owners.

In part, opponents of the EPA’s GHG rule argued that it relied on carbon capture and sequestration technology that isn’t commercially available.

“EEI appreciates EPA’s acknowledgement that carbon capture and storage technologies are not yet viable for widespread deployment,” said Alex Bond, executive director of legal and clean energy policy at the Edison Electric Institute, a trade group for investor-owned utilities. “Electric companies need standards for natural gas facilities that are attainable to plan and permit new facilities, along with flexible regulatory approaches that help maintain dispatchable generation.”

EEI continues to support the EPA’s authority to regulate GHG emissions under the Clean Air Act, according to Bond.

Power plants account for about a quarter of U.S. carbon emissions, making them the second largest source of GHG emissions behind the transportation sector, according to the EPA. If the U.S. power sector were a country, it would have been the sixth largest source of emissions worldwide in 2022, according to a paper released on May 30 by the Institute for Policy Integrity at New York University School of Law.

However, in its proposed rule, the EPA said carbon emissions from power plants do not contribute significantly to dangerous air pollution within the meaning of the Clean Air Act, partly because “this Administration’s priority is to promote the public health or welfare through energy dominance and independence secured by using fossil fuels to generate power.”

The Institute for Policy Integrity contends that EPA’s proposal relies on “haphazard analysis.” In its cost-benefit analysis for the draft rule, EPA reverses long-running agency practice by not valuing the carbon emissions the rule will cause, the organization said.

Under the Biden administration, the EPA estimated the carbon limits would produce up to $370 billion in climate and public health benefits.

“Greenhouse gas emissions cause extensive economic harm, and their proper valuation is certainly not zero as this proposal essentially suggests,” said Richard Revesz, faculty director at the institute and a professor at New York University School of Law. “Courts have previously rejected agency analyses that undervalue or fail to value the significant and well-established damages from greenhouse gases.”

On the proposed MATS rule, coal-fired power plants are the largest domestic source of many toxic metals, including mercury, according to Earthjustice, which noted that most power plants have installed the technology to meet the standards.

“The critical protections that EPA now seeks to undo exist because science and the law demand that EPA act,” Jill Tauber, Earthjustice vice president of climate and energy, said in a statement.

The EPA will take public comment on its proposals for 45 days after they are published in the Federal Register.

In 2023, the U.S. federal government collected $4.67 trillion in taxes and redistributed $4.56 trillion back to states and residents. But which states contributed the most—and least—on a per-person basis?

This dataset, originally published by USAFacts, shows how much federal revenue each state generated per capita.

Delaware led all states with $24,575 in federal taxes paid per resident, driven by high levels of business incorporation. Massachusetts ($21,747) and Minnesota ($20,728) followed, thanks to high average incomes. Meanwhile, the lowest contributors per person were West Virginia ($4,867), Mississippi ($5,148), and New Mexico ($5,882).

The Population-Revenue Disconnect

While California, Texas, New York, and Florida are the top contributors in absolute terms, collectively making up more than a third of all U.S. federal revenue, the per capita view tells a different story.

Smaller states with wealthy or business-friendly profiles, like Connecticut and New Jersey, rank much higher in per-person contributions.

Washington, D.C., is an outlier, contributing $54,612 per resident. That’s more than twice the amount of the top state. This is largely due to the city’s dense concentration of high-income earners and government-affiliated economic activity.

Do States Get Back What They Pay In?

Not all federal dollars stay in Washington. Most are returned to residents and states through entitlement programs like Social Security and Medicaid, as well as infrastructure, education, and defense.

However, some states get more than they give. In 2023, 19 states were net contributors—sending more to the federal government than they received. New York tops that list with a $89 billion net outflow. Conversely, Virginia received about $79 billion more than it paid in, largely due to defense spending.

Explore how federal money moves over time in our recommended Voronoi post: U.S. Federal Government Finances Over Time.

Authored by Guy Birchall via The Epoch Times (emphasis ours),

UK exports to the United States suffered a sharp drop of 8.8 percent in April, as the effect of U.S. President Donald Trump’s sweeping tariffs began to take effect, official data revealed on June 12.

After rising for the past four months, British goods exports declined significantly, by 2.7 billion pounds ($3.7 billion) in April 2025, with falls in exports to both the EU and non-EU countries.

“After increasing for each of the four preceding months, April saw the largest monthly fall on record in goods exports to the United States with decreases seen across most types of goods, following the recent introduction of tariffs,” Liz McKeown, the director of economic statistics at the Office for National Statistics (ONS), said.

After rising for the past four months, British exports to the U.S. market, including precious metals, dropped by 2 billion ($2.7 billion) in April 2025, the largest monthly decrease since records began in January 1997.

The value of goods exports to the United States is now at its lowest level since February 2022, the ONS added.

Auto manufacturers also reported lower output and exports to both the United States and the European Union.

British economic output declined during the month of April, with gross domestic product falling by 0.3 percent from the previous month.

Drop-offs in real estate and legal activity after a temporary tax break on house purchases ended also contributed 0.2 percentage points of the 0.3 percent fall in output in April, according to the ONS.

Britain’s total trade in goods and services deficit (excluding precious metals) also widened by 4.9 billion pounds ($6.7 billion) to 11.5 billion pounds ($15.6 billion) in the three months to April, as imports rose more than exports.

The pound dropped by a quarter of a cent against the dollar after the ONS data were released.

The fall off in trade across the Atlantic comes a little more than a month after London and Washington jointly announced a much-celebrated trade deal on May 8.

Though full details of the agreement have yet to be hammered out, what was revealed was that the UK would lower the tariff rate on U.S. goods from 5.1 percent to 1.8 percent.

The 10 percent U.S. universal baseline tariff rate on UK goods, however, remained in place.

At the time, British Prime Minister Keir Starmer said: “This historic deal delivers for British business and British workers protecting thousands of British jobs in key sectors including car manufacturing and steel.”

In a post on social media platform Truth Social, Trump called the deal a “full and comprehensive one that will cement the relationship” between the two nations.

No official document, however, has yet been signed by the two countries.

Britain’s economy grew in the first quarter of this year by 0.7 percent, more than other countries in the G7.

This prompted the Bank of England to revise up its full-year growth forecast to 1 percent in May.

However, the national bank revised its growth forecast for next year down to 1.25 percent, saying it expected United States tariffs to hit British output to the tune of 0.3 percent in three years’ time.

The news of the drop in trade comes a day after the UK’s finance minister, Chancellor of the Exchequer Rachel Reeves, delivered her first multi-year spending review to the Parliament in Westminster.

During her speech, she pledged major investments in health, housing, defense, and infrastructure.

At the core of the government’s plans to “renew Britain” is an annual increase of 29 billion pounds ($39.4 billion) in National Health Service funding.

Other pledges include 39 billion pounds for social and affordable housing over the next decade and confirmation of a previously announced 30 billion pounds ($40.8 billion) for nuclear projects, including 14.2 billion pounds ($19.3 billion) for a new nuclear plant.

Reeves said the budget boosts were “only possible” because of her decision to raise taxes in the previous autumn budget, reaffirming that her fiscal rules are “non-negotiable.”

The opposition Conservative Party, however, described the plan as “not worth the paper that it is written on.”

Shadow Chancellor Mel Stride said Reeves has “completely lost control,” suggesting that tax hikes in the fall are inevitable.

“This is the spend now, tax later review, because [the chancellor] knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits,” he told the Commons.

In the wake of yet another alleged sex crime perpetrated by non-natives, a city in Northern Ireland has been rocked by three consecutive nights of anti-immigration riots. In this case, two 14-year-olds arrested on Sunday stand accused of attempted oral rape of a teenage girl on the previous night. The ensuing wave of arson, vandalism and anti-police violence — which has left more than 32 officers injured — has spread from Ballymena to other towns, prompting authorities to deploy reinforcements from the area and to request 80 officers be dispatched from across the Irish Sea. 

While there’s been no official announcement about the alleged perpetrators’ origins, their appearance in court was facilitated by a Romanian translator, and social media chatter indicates they’re Roma. “She was taken into a house and brutally sexually assaulted on Saturday evening,” a woman identified as a relative of the latest alleged victim told a social-media interviewer. “There was a mattress in the garage.” According to their conversation, this was the third incident in a fortnight, with at least one of the other incidents also involving a teenage girl. 

🚨 Breaking: Ballymena NI, family of victim speaks out! The second sexual assault in the area in two weeks! pic.twitter.com/LBolV1vbVH

— Gabhán (@OffgridIreland) June 10, 2025

Following this latest sexual attack, what started as a peaceful Sunday vigil in protest of the sex crime and support of the victim rapidly turned violent, as angry residents broke away from the main event and set out for an immigrant-heavy part of the town of 31,000 residents, where they set homes ablaze, built barricades and hurled blocks and other objects at police. A pregnant woman had to be evacuated when her house was set ablaze. Authorities have condemned what they call “hate-fueled acts and mob rule.” 

Police have struggled to maintain order, as they’ve been attacked with Molotov cocktails, fireworks and bricks. Cops in full riot gear have deployed water cannons and dogs against the crowds, and used groups of up-armored Land Rovers in a rolling phalanx formation. This video purports to show a residential arson attack from the perspective of the perpetrators: 

Racist ferals burning a house of a foreigner in Ballymena, NI.

By doing this they’re pretending to be the defenders of white women and children. pic.twitter.com/pDIEpRdUUk

— DOZA🧐 (@lil_doza) June 11, 2025

To steer rioters away from their homes, residents have started marking their doors with Union Jack signs and flags, or signs saying “British household.” Another home’s signage read “Filipino lives here,” hoping that their particular identity isn’t the target of violence. “No one, now or ever, should feel the need to place a sticker on their door to identify their ethnicity just to avoid being targeted,” lamented Northern Ireland First Minister Michelle O’Neill in a Wednesday statement. 

While Ballymena is the current epicenter of the mayhem — alongside more peaceful and orderly marches — the outward, active discontent has spread to other cities and towns, including Belfast, Lisburn, Coleraine and Newtownabbey. Per the latest census, 16% of Ballymena residents are now something other than native British or Irish, with the largest group being Romanians, followed by Poles, Bulgarians and Slovakians.  

Amid the relentless stream of sex crimes and mass murders perpetrated by immigrants across Western Europe, it’s likely that native residents will increasingly take out their feelings of helplessness in violent fashion.  

Two of Hollywood’s biggest players – Disney and NBCUniversal – have teamed up to launch a legal assault on the AI world, suing image generator Midjourney for what they call blatant copyright infringement.

According to a federal complaint filed in California and obtained by Axios, the entertainment giants accuse Midjourney of illegally using their copyrighted characters to train its artificial intelligence tools and of generating near-replica images of their intellectual property.

It’s the first time major Hollywood studios have taken a generative AI company to court – a legal showdown that could set a precedent for how studios protect their decades of iconic content in the age of artificial intelligence.

The complaint points to dozens of visual examples of alleged infringement, including AI-generated versions of Disney characters from “The Lion King” and “Aladdin,” and NBCUniversal’s unmistakable Minions. The lawsuit accuses Midjourney of both direct and secondary copyright violations.

Midjourney, the studios claim, refused to play ball even after attempts to resolve the matter quietly.

Midjourney “continued to release new versions of its Image Service, which, according to Midjourney’s founder and CEO, have even higher quality infringing images,” the complaint states. The company, it adds, “is focused on its own bottom line and ignored Plaintiffs’ demands.”

Unlike other AI firms that allegedly agreed to rein in unauthorized use of studio-owned content, Midjourney did not take the issue seriously, the filing alleges.

The move signals that Hollywood is shifting from internal battles with striking actors and writers over AI usage, to an external legal front against AI developers. Disney and NBCU — owners of two of the most valuable IP catalogs in the world — are leading that charge.

Horacio Gutierrez, senior executive vice president and chief legal and compliance officer of The Walt Disney Company, didn’t mince words.

“Our world-class IP is built on decades of financial investment, creativity and innovation – investments only made possible by the incentives embodied in copyright law that give creators the exclusive right to profit from their works,” Gutierrez said. “We are bullish on the promise of AI technology and optimistic about how it can be used responsibly as a tool to further human creativity. But piracy is piracy, and the fact that it’s done by an AI company does not make it any less infringing.”

Kim Harris, executive vice president and general counsel of NBCUniversal, echoed the sentiment: “We are bringing this action today to protect the hard work of all the artists whose work entertains and inspires us and the significant investment we make in our content. Theft is theft regardless of the technology used, and this action involves blatant infringement of our copyrights.”

While the Motion Picture Association represents a broader alliance of studios — including Netflix, Amazon, Paramount, Sony, and Warner Bros. — this lawsuit underscores growing rifts in strategy, as individual companies go on offense.

Other industries have already taken similar action. In February, over a dozen major news outlets sued AI company Cohere, with support from the News Media Alliance, which represents thousands of publications.

The legal strategy emerging from Tinseltown appears clear: go after the platforms creating and distributing infringing content — not the individual users.

Midjourney has not publicly responded to the lawsuit as of press time.

LIVE FEED from Al Jazeera:

* * * 

Update2330ET: It appears there were at least two waves of Israeli attacks, with smoke still seen over Iranian military sites and areas of Tehran in the daylight morning hours.

• ISRAEL PREPARING FOR IRANIAN RESPONSE IN COMING HOURS: KAN NEWS
• IRAN STATE MEDIA: MULTIPLE MILITARY SITES IN TEHRAN TARGETED
• IRAN NATANZ NUCLEAR SITE TARGETED: STATE MEDIA
• IRAN ARAK HEAVY WATER REACTOR FACILITY TARGETED: STATE MEDIA
• ISRAEL LAUNCHED ANOTHER WAVE OF ATTACKS IN IRAN: ARMY RADIO

Natanz after new explosions:

IRGC sites attacked:

Smoke rising above the IRGC Headquarters in Tehran pic.twitter.com/6zdUeEigbI

— Michael A. Horowitz (@michaelh992) June 13, 2025

Destruction in Tehran:

⚡️Tehran destruction pic.twitter.com/VDi6BS17TB

— War Monitor (@WarMonitors) June 13, 2025

⚡️ Reports also of attacks in western Iran pic.twitter.com/tbAhX3SfV1

— War Monitor (@WarMonitors) June 13, 2025

A breaking note via UBS:

White House envoy Steve Witkoff reportedly warned top Senate Republicans last week that Iran could launch a large-scale missile and drone retaliation if Israel attacked its nuclear sites, saying that this could overwhelm Israeli defenses and cause heavy damage, according to various media (here and here). Israel has since attacked a key nuclear site in Natanz and Iran has vowed to respond with force. Both Brent and WTI crude prices are up more than 12%.

* * *

Update2215ET: In a massive development via Iranian state sources, the head of the Islamic Revolutionary Guard Corps (IRGC), Major Gen. Hossein Salami has been killed in Israel’s major Israeli attack on Tehran and other locations in Iran. Al Jazeera: “Iran’s Tasnim news agency and Tehran Times newspaper say Hossein Salami, commander-in-chief of the Islamic Revolutionary Guard Corps, has been killed in an Israeli strike.”

• IRAN’S IRGC CHIEF SALAMI KILLED IN ISRAELI ATTACKS: TASNIM
• IRAN PLANNING ‘DECISIVE RESPONSE’ TO ISRAELI ATTACK: IRNA
• Key uranium enrichment facility in central Iran ‘hit several times’: state TV

Just yesterday…

Meanwhile, some US Congressional members are not in the mood for another major war:

Jack Reed, the top Democrat on the Senate Armed Services Committee, criticizes the Israeli attacks on Iran and calls on Trump to push for de-escalation.

“Israel’s alarming decision to launch airstrikes on Iran is a reckless escalation that risks igniting regional violence,” Reed in a statement.

“I urge both nations to show immediate restraint, and I call on President Trump and our international partners to press for diplomatic de-escalation before this crisis spirals further out of control.”

* * *

Update (2115ET): Al Jazeera and regional media have reported at least six large explosions were observed in the Iranian capital of Tehran, as Israel confirms it has launched ‘Operation Rising Lion’ – which importantly Netanyahu in a televised address said “will continue for as many days” until the Iranian ‘nuclear threat’ is removed, and “as long as necessary”.

There are unconfirmed reports that Iranian jets have been scrambled and that the Islamic Republic’s inevitable retaliation has begun. Iran possesses an immense ballistic missile arsenal, many which can be launched from underground silos and deep below ground ‘missile cities’. Developing:

• ISRAEL BELIEVES IT KILLED SOME IRAN GENERALS, ATOMIC SCIENTISTS
• ISRAEL MILITARY OFFICIAL COMMENTS ON KILLINGS OF IRAN OFFICIALS

Prime Minister Netanyahu:
“Moments ago, Israel launched Operation Rising Lion, a targeted military operation to roll back the Iranian threat to Israel’s very survival.

This operation will continue for as many days as it takes to remove this threat.” pic.twitter.com/3c8oF1GCYa

— Prime Minister of Israel (@IsraeliPM) June 13, 2025

There are also reports of large blasts heard in Natanz city, home to a key nuclear site, according to Iranian state TV. Hawkish Republican Senator Lindsey Graham has issued a short tweet saying “Game on”.

Unconfirmed but likely…

#BREAKING Iranian missiles are heading for Israel pic.twitter.com/2bCmMiqzEw

— War Intel (@warintel4u) June 13, 2025

Reports of Iranian air force jets taking off…

🇮🇷 Iranian jets taking off. Iranian ballistic missile launches also reported. pic.twitter.com/61H8Pde4Jm

— DD Geopolitics (@DD_Geopolitics) June 13, 2025

* * *

Update 8:35pm: AP cites an Israeli official who says that the targets are Iran Nuclear and Military sites; Meanwhile Iran has suspended all flights into its international airport, while Israel has closed all airspace. 

• Netanyahu: ‘Operation Rising Lion’ Launched
• Ongoing rockets/missiles near or on Baghdad International Airport , sources in the airport confirmed to me hearing ongoing explosions
• NYT quoting an Iranian official: Three residential buildings demolished in the Shahrak Shahid Mahallati neighborhood in Tehran, where senior military leaders reside
• ISRAEL OFFICIAL CONFIRMS ATTACK TARGETED IRAN NUCLEAR SITES: AP
• IRAN SUSPENDS FLIGHTS AT TEHRAN INTERNATIONAL AIRPORT: TASNIM

The Israeli defense forces add that dozens of IAF jets complete the first stage of Iran strikes. 

Looks like targeted assassinations are underway in Iran pic.twitter.com/QGhJ8tuj1B

— Aleph א (@no_itsmyturn) June 13, 2025

Israeli PM Netanyahu says comments that Israel is attacking Iran’s nuclear program, is seeking to remove the ballistic missile threat and that strikes will last until last threat is removed.

• NETANYAHU: WE ARE AT A DECISIVE MOMENT IN ISRAEL’S HISTORY
• NETANYAHU: ATTACKING IRAN’S NUCLEAR PROGRAM, BALLISTIC MISSILES
• NETANYAHU: STRIKES WILL LAST UNTIL THREAT REMOVED
• NETANYAHU: WE TARGETED IRAN’S MAIN ENRICHMENT FACILITY IN NATANZ
• NETANYAHU: SEEKING TO REMOVE BALLISTIC MISSILE THREAT

It also appears that the reason Israel targeted specifics residential buildings is because as we expected, it was conducting targeted assassinations:

• NETANYAHU: WE TARGETED IRAN’S LEADING NUCLEAR SCIENTISTS WORKING ON THE IRANIAN BOMB, WE ALSO STRUCK THE HEART OF IRAN’S BALLISTIC MISSILE PROGRAMME

Meanwhile, the US State Department is pretending like it had zero involvement in this latest neocon-inspired debacle. 

• *RUBIO SAYS US IS NOT INVOLVED IN ISRAEL STRIKES AGAINST IRAN
• *RUBIO: IRAN SHOULD NOT TARGET U.S. INTERESTS OR PERSONNEL
• *RUBIO: ISRAEL TOOK UNILATERAL ACTION VS IRAN

Good luck with Iran buying that.

* * *

Futures and yields are tumbling, and gold and oil are surging following reports of successive explosions in Iran as a result of what Al Arabiya reports are Israeli airstrikes; Axios has confirmed that the Israeli Air Force conducted a strike in Iran, “attacking its biggest and best-armed adversary, without clear backing from the U.S.” It was not immediately clear who Israel is targeting.

Strikes on Tehran reportedly targeted air-defenses and other military sites throughout the city. pic.twitter.com/T3WX4Re1Gq

— OSINTdefender (@sentdefender) June 13, 2025

As Axios adds, sirens are sounding across Israel on Thursday night. Israeli Defense Minister Israel Katz declared a special state of emergency across the entire country, and said he expects retaliation after the preemptive Iran strike.

Smoke seen rising from several sites across the Iranian capital of Tehran, following strikes by the Israeli Air Force. pic.twitter.com/9DkweHmHIJ

— OSINTdefender (@sentdefender) June 13, 2025

“Following the State of Israel’s preemptive strike against Iran, a missile and drone attack against the state of Israel and its civilian population is expected in the immediate future,” Katz said.

An Israel Defense Forces spokesperson said only “necessary” activities should take place in Israel starting Friday morning local time. That includes a ban on “educational activities, gatherings and workplaces, with the exception of essential businesses.”

Ahead of the Israeli strikes, the US notified several allies in private on Thursday that Israeli strikes were imminent and made clear it was not involved, one of the Axios sources said.

Sure enough, moments after the airstrikes, CNN reported that Trump is convening a cabinet level meeting. 

Meanwhile, as Trump said earlier today, his administration already told Israel it would not participate in any strikes on the nuclear program, however, the U.S. has previously helped defend Israel from Iranian attacks and would likely do so again if this strike kicks off a retaliatory cycle according to Axios.

In doing so, the US president will likely lose substantial backing from those who do not want to be associated with neocons. But at least Lindsay Graham will have wonderful things to say about Trump. 

While it is unclear what the targets of Iran’s airstrikes are, some have speculated that since the targets are residential buildings that these are targeted assassinations.

Looks like targeted assassinations are underway in Iran pic.twitter.com/QGhJ8tuj1B

— Aleph א (@no_itsmyturn) June 13, 2025

🇮🇷 Visuals of some of the aftermath in Tehran tonight following Israel’s Operation “Strength of a Lion.” pic.twitter.com/PZJOzslt6x

— DD Geopolitics (@DD_Geopolitics) June 13, 2025

#BREAKING: Initial reports of an Israeli targeted assassination attempt in Tehran pic.twitter.com/9SZaI7BNIj

— ELINT News (@ELINTNews) June 13, 2025

⚡️Civilian apartment building collapsed in Tehran following Israeli strike pic.twitter.com/IxpolQnyit

— War Monitor (@WarMonitors) June 13, 2025

In kneejerk response, stock futures are tumbling…

… as are bond yields…

… while Oil (where we recently warned that the record shorts will be badly burned)…

… and gold are soaring.

The question now is whether this is all performative theater, like the two cases of “non-war” a year ago when the two sides exchanges violently dramatic if completely ineffective strikes against each other, or if this is the real thing and shortly Iran’s nuclear facilities will be a pile of rubble. 

Authored by Christian Whiton via RealClearPolitics,

Federal Reserve kingpin Jerome Powell is busy doing what he does best: sabotaging a prosperous economy so that President Donald Trump and his fellow Republicans lose popularity. He’s also ignoring Trump, whom voters will judge for the economy’s performance and whom the Constitution says runs the executive branch of which the Fed is a part.

This is old hat for Powell, who, after being installed by Trump in 2018, got straight to work undermining his boss’s economic recovery.

You may recall that one of the circumstances that brought an unusual candidate like Trump to power in 2016 was the preceding decade of economic malaise. The Obama years averaged just 2.1% annual growth – the most lethargic economic recovery since World War II. It was fashionable among establishment economists to say that growth above this level, especially the 4.3% average annual growth of the Reagan boom, was simply unobtainable. Big-government economists – practically a redundant phrase today – called it “secular stagnation.” 

Enter Trump. Upon taking office, he immediately began deregulating the U.S. economy, particularly in the energy sector. He worked with Congress to lower the corporate tax rate from 35%, which was nearly the highest among advanced economies, to a more competitive 21%. He also cut personal income taxes for every income bracket, which meant lower taxes for the majority of small business owners who pull company income and taxes onto their personal tax returns.

Trump also incentivized corporations to bring home capital they held overseas. Apple alone said it would bring home a majority of its roughly $252 billion in offshore reserves, paying a one-time tax of $38 billion.

The results for the broader economy were impressive. Annualized GDP growth in the quarter Trump took office was 2.0%. By the end of the year, it had jumped to 4.6%. Unemployment dropped from 4.7% to 4.0%. Manufacturing jobs, which totaled nearly 17 million when NAFTA was enacted in 1994 and globalization ensued, had fallen to 12.3 million when Trump took office. Within a year, the sector saw modest improvement to 12.5 million jobs. Oil production increased from 8.9 million to 10 million barrels per day during that year. (It would reach 13 million later in Trump’s first term.)

But Powell was having none of it. Like most of his predecessors and colleagues at the Federal Reserve, Powell adheres to the discredited Keynesian school of economics, which holds that the government should play a preponderant role in the economy, managing demand through government spending. Keynesians distrust free markets, free people, and the supply side of the economy that produces tangible goods. They believe economic growth leads inevitably to inflation, despite repeated economic expansions, including most notably Reagan’s, in which the expansion of the private-sector economy leads to more goods and services produced and stable prices.

In 2018, Powell saw looming inflation where there was none and tightened monetary policy for the first time since 2008. When Trump was elected in 2016, the federal funds effective rate stood at 0.41%. Despite no inflation, the Fed began a relentless cycle of rate increases that reached 2.2% in time for the 2018 midterm elections, when Republicans lost control of the House of Representatives to Democrats, leading eventually to Trump’s impeachment.

Beyond being a Keynesian, Powell is also a fool. Trump’s first term isn’t the only time he saw inflation where there was none, or failed to see inflation when it was obvious. During the Biden administration, long after the pandemic had peaked, Powell enabled continued federal spending at crisis levels despite the lack of a crisis. Biden’s Treasury Department issued bonds to pay for unprecedented deficits in excess of $1.5 trillion. This only worked because Powell had the Fed buy the bonds with dollars created out of thin air. He also tried to goose the Biden economy by buying mortgages from banks immediately after they were issued. The Fed’s balance sheet of debt it owned grew from $7.4 trillion when Biden took office to a peak of $10 trillion just over a year later. Powell also kept interest rates near zero even as inflation caused by his dilution of the dollar skyrocketed.

Inflation peaked at over 9% in 2022, and the cumulative inflation of the Biden years and Powell’s debasement of the currency eliminated more than 20% of Americans’ purchasing power. Powell and his establishment friends had assured Americans that inflation was “transient” when it wasn’t.

Powell was eventually forced to acknowledge inflation and reluctantly began hiking interest rates to above 5%. He then started lowering them just before the 2024 election in an effort to help Democrats keep the White House. But the easing stopped when Trump took office. Even as central banks in Europe have cut rates due to the lack of inflation, Powell and his clique at the Fed have refused to do so, keeping them at sustained heights not seen in 20 years.

Trump has repeatedly pressured Powell to lower rates. He did so again on June 6 when the government reported that job growth had moderated and revised downward the job growth reported in previous months.

If a Republican president pressuring Powell could work, it would have worked by now. Instead, Trump will have to fire Powell and replace him with a pro-private-sector-growth banker who takes guidance from the president.

Powell and many establishment pooh-bahs think such a move would be illegal. After Trump’s reelection, Powell vowed not to resign and said his termination is “not permitted under the law.” In fact, the Federal Reserve Act does allow Powell’s removal “for cause,” and grotesque incompetence and political conniving ought both to qualify.

But in fact, the whole idea of an “independent” Federal Reserve is unconstitutional, and Trump should fire Powell not only to save the economic recovery but to restore the power of the presidency and recognize the reality that the American people hold the president responsible for economic performance. If he is on the hook to perform, he must control the tools to do so.

Article II of the Constitution states plainly, “The executive Power shall be vested in a President of the United States of America.” In the Federalist Papers #70, Alexander Hamilton explained the necessity of the strong executive created by the then-draft Constitution to skeptics: “A feeble Executive implies a feeble execution of the government. A feeble execution is but another phrase for a bad execution; and a government ill executed, whatever it may be in theory, must be, in practice, a bad government.” It’s as though Hamilton could foresee Powell and the Fed of 2025.

There should be no doubt that the Framers of the Constitution intended the president to have the power to fire anyone as part of his responsibility to supervise the unitary executive branch. What was true in 1789 is still true today: any schmuck in Washington knows no bureaucrat will pay you much attention unless you might plausibly take away his job or budget.

Creating a person beyond the reach of the president in the executive branch would be like creating an unelected politburo in Congress to handle certain issues, or a special court completely independent from the Supreme Court to handle certain legal cases. Voters would see such actions as obviously unconstitutional attempts to weaken those pillars of democracy. So too is a theoretically independent Fed – an essentially fascist construct that purports to put monetary policy beyond the reach of the president, weakening the office held by the only man who represents all of the American people. 

In recent years, the Supreme Court has consistently held that the president has the right to fire executive branch officials. It did so again last month in allowing Trump to dismiss members of supposedly independent federal agencies.

There was, however, a glitch. The unsigned order stated that: “The Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States.” This red herring in the court’s order implied its recognition of the president’s power to fire might not extend to the Fed.

In reality, there is nothing “quasi-private” about an organization that sets interest rates and decides how many dollars to print. Furthermore, the court should take note of another “distinct historical tradition” that began in Franklin Roosevelt’s administration of pondering packing the court with new justices when its rulings are at odds with the wishes of administrations and Congresses. It’s better to stick with what the Constitution means and says lest a flexible view of the Framers’ intent turn around and bite the court or Congress in their asses.

Furthermore, make-believe about an independent Federal Reserve was more believable when Fed chairmen took cues from presidents regardless of their political party. More recently, Fed bosses have joined the rest of the Deep State in seeking to help Democrats and harm Republicans. Firing Powell and dispensing with the fiction of his unfireability will be good for the economy, good for the presidency, and good for democracy.

Christian Whiton was a senior advisor at the State Department in the second Bush and first Trump administrations and served as an adviser to the secretary of state and other senior officials about public affairs and East Asia matters. He is a senior fellow at the Center for the National Interest and a principal at Rockies Aria LLC, a public affairs and government relations firm. 

By Lamar Johnson of Utility Dive

Kiggans and a nearly identical group of House Republicans wrote to their House colleagues last month seeking positive changes to the clean energy tax credit phaseout plan that came out of committee work on the reconciliation bill. Instead, the House-passed version of the bill imposes a faster phaseout timeline, including a repeal of tax credits for projects that don’t begin construction within 60 days of the bill’s enactment.

The Republican lawmakers in support of IRA’s clean energy credits asked that the Senate alter that provision — along with a foreign entity of concern provision that was again called “overly prescriptive” — and maintain tax credit transferability throughout the credits’ lifetime. The group said that though they were “proud to have worked to ensure that the bill did not include a full repeal of the clean energy tax credits,” they remain “deeply concerned about those provisions.”

The tax credit phaseout schedule included in the House-passed bill, “would cause significant disruption to projects under development and stop investments needed to win the global energy race,” the letter said. The lawmakers said the overall approach to the tax credit changes “jeopardizes ongoing development, discourages long-term investment, and could significantly delay or cancel energy infrastructure projects across the country.”

The group recommended the 60-day timeline and the bill’s “placed in service” standard should be replaced with a “commence construction” requirement. The group said that due to permitting delays and other issues outside of project developers’ control, it is hard for the businesses to be sure when their projects will be “placed in service.” Swapping that language with a “commence construction” provision would give companies more flexibility to understand if they are eligible for certain credits and give “the investment clarity and lead time required for energy projects to succeed,” according to the Republican lawmakers.

“Our position has always been that the energy tax code should be modernized in a way that promotes fiscal responsibility and business certainty,” the letter said. “Fully realizing that balance requires improvements to the House-passed version of … the One Big Beautiful Bill Act.”

Kiggins was joined on the letter by Reps. Andrew Garbarino, Mike Lawler and Nick LaLota of New York; Mark Amodei of Nevada; Don Bacon of Nebraska; Brian Fitzpatrick and Rob Bresnahan of Pennsylvania; Juan Ciscomani of Arizona; Gabe Evans of Colorado; Young Kim and David Valadao of California; and Thomas Kean Jr. of New Jersey. Garbarino reportedly slept through the full House vote on the bill — which passed by a single vote — but later said he looks forward to supporting the bill’s passage when it comes back from the Senate.

Utilities and renewable energy experts have said the current 60-day timeline would “trigger a scramble” to do as much as possible within that window, while other clean energy experts called the House-passed bill “unworkable” in its current form.

A federal judge on Thursday blocked the Trump administration from deploying the National Guard to Los Angeles, and has directed Trump to ‘return control of the California National Guard to Governor Newsom.’

BREAKING: Judge Breyer orders Trump to return control of the National Guard back to California, saying the call-up was illegal. https://t.co/RjvefxZKIm pic.twitter.com/yBT8w5ypzD

— Kyle Cheney (@kyledcheney) June 13, 2025

Judge Charles Breyer a Clinton appointee, issued his ruling late Thursday, after Newsom requested to immediately restrict the troops’ power on the ground, and suggested that at minimum, federal law required Trump to alert the governor’s office. 

Breyer repeatedly emphasized during a hearing earlier that Trump is exercising presidential authority – not that of a King (playing right into the current protests, of course). 

“That’s the difference between a constitutional government and King George,” said Breyer. ““It’s not that a leader can simply say something and then it becomes it. It’s a question of is a leader, a president or the governor, following the law as set forth in both the Constitution and statutes.”

“That’s what a president, a governor or any leader must act under. Otherwise, they become something other than a constitutional officer.“

Breyer also agreed with Newsom’s legal argument that Trump’s deployment was legally defective. 

That said, as Politico‘s Kyle Cheney points out, Breyer gave the Trump admin until Noon Friday, which “should be enough time for Trump to seek emergency appeal at the 9th Circuit and perhaps Supreme Court.”

Breyer stays his order until noon tomorrow, which should be enough time for Trump to seek emergency appeal at 9th Circuit and perhaps Supreme Court. https://t.co/RjvefxZcSO pic.twitter.com/AbXYVumPaE

— Kyle Cheney (@kyledcheney) June 13, 2025

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