Global Markets Face Volatility Despite Tactical Truce, Expert Warns

Global markets remain volatile, influenced by the recent summit between Presidents Trump and Xi, and fluctuating global yields. Dr. Ilan Gildin, a partner and hedge fund manager at Carney Family Office, characterized the agreements between the US and China as a "tactical pause" rather than a fundamental shift in relations. He explained that key issues concerning technology and national security have not been resolved but merely postponed.

In the local currency market, the strengthening dollar against the Israeli shekel is attributed to the US Federal Reserve's interest rate decision and increased regional risk premiums. However, Gildin believes that Israel's current account surplus and the Bank of Israel's substantial foreign exchange reserves will limit the shekel's depreciation potential.

Globally, the bond market is experiencing selling pressure, with rising yields signaling investor concern that the Federal Reserve is lagging behind in addressing inflation expectations and energy prices. In Asia, despite South Korea's KOSPI index surpassing 7,000 points due to strong export data and AI sector growth, Gildin cautioned against declaring an end to the negative market correction. He cited potential headwinds such as Japan's interest rate hikes, unwinding of carry trade positions, and reliance on oil imports as factors that could continue to weigh on capital flows into Asia in the near term.