Iran

Red Light. Green Light. So much for the “all clear” in the Hormuz saga. 

The Iran war is deescalating further — against our expectations — setting up an aggressive return to the risk-on rally. 

The dollar’s pullback masks a quiet improvement in its cyclical backdrop, with growth, monetary policy, and flows turning in its favor. As markets fully price out geopolitical risk, the USD should decouple from oil and better reflect these gains, despite lingering structural headwinds.

Markets may be underpricing a bifurcated political outcome. Unless the Iran deescalation succeeds, the delayed economic fallout from the energy shock could materially worsen Republican prospects and raise the probability of a Democratic Senate victory.

When the ceasefire between Iran and the US was announced on April 8, several clients told us that their geopolitical consultants were pitching a bearish narrative. The US had set up the two-week ceasefire to surge more material and troops to the region, so as to set up the next phase of the conflict. One such advisory firm also pointed out that it was unlikely that the US would hold back on further conflict since it had “already amassed ground troops to the region.” 

Uranium’s bull market remains intact, supported by structural supply deficits, rising nuclear demand, and tightening fuel-cycle constraints. The Iran war reinforces energy security concerns while disrupting key inputs like sulfur, exacerbating supply risks. With contracting strengthening and policy support accelerating, uranium is re-emerging as a strategic commodity with durable upside.