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Oil prices surged further on Tuesday amid continued U.S.-Iran exchanges of fire around the Strait of Hormuz, with both benchmark contracts rebounding more than 10% over the past two sessions.
International benchmark Brent crude climbed above $85 per barrel in early trading, while U.S. benchmark WTI also rose above $80 per barrel for the first time since the memorandum took effect in mid-June, before retreating slightly in the following hours.
Asian markets edged higher after Monday's steep losses, with Japan's Nikkei 225 trading up 0.5% and South Korea's Kospi up 1.6%. Mainland China's Shanghai Composite inched up 0.3%, while Hong Kong's Hang Seng gained 0.7%.
Futures tied to the Stoxx 50 were down 0.4%, while futures linked to the tech-heavy U.S. Nasdaq index rose 0.5% as of 6 a.m. GMT.
Precious metals also recouped some of their losses from the previous session, with gold rebounding 0.7% to climb back above the $4,000 mark and silver rising 1% to $58.2 per ounce. Platinum and palladium also edged higher by 0.4% and 1.5% to $1,600 and $1,250, respectively.
Cryptocurrencies, meanwhile, traded mixed, with bitcoin slipping 0.3% to $62,600 while ethereum gained 0.2% to $1,780.
The renewed U.S.-Iran confrontation comes as financial markets enter one of the busiest weeks of the quarter, with geopolitical tensions colliding with a packed earnings and economic calendar.
The latest escalation followed Iran's strike on a commercial vessel in the Strait of Hormuz, and Tehran's subsequent decision to close the strategic waterway. Washington answered with strikes on military targets across Iran, prompting retaliatory attacks on U.S.-linked facilities in Bahrain, Jordan, Kuwait and Oman.
Ahead of the latest U.S. campaign, President Donald Trump said the United States would reinstate a blockade on the Strait of Hormuz, adding that while Iranian ports would again face restrictions, "all other countries will have fair and open use of the strait."
Attention now shifts to the unofficial start of the second-quarter earnings season, with major U.S. banks including JPMorgan Chase, Bank of America, Goldman Sachs, Citigroup, Wells Fargo and Morgan Stanley set to report results that could offer fresh insight into the health of the economy.
Investors are also watching a string of key U.S. data releases, including the June consumer price index (CPI) figures on Tuesday, the producer price index (PPI) data on Wednesday, and retail sales on Thursday.
Federal Reserve Chair Kevin Warsh is due to deliver his first semiannual testimony before Congress, with markets looking for further signals on inflation, interest rates and the policy outlook.
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