Global Markets Brace for US-Iran Tensions, Fed Rate Hike Fears

Global stock markets opened with renewed US-Iran tensions after American forces struck Iranian missile launchers in the Strait of Hormuz. Iran retaliated with missile launches targeting US bases in Jordan. The conflict has driven oil prices up by approximately 2%, with Brent crude surpassing $90 a barrel. Asian markets and US futures are trading lower.

The Tel Aviv Stock Exchange is expected to open with declines, influenced by the escalating US-Iran conflict and potentially impacting the Bank of Israel's upcoming interest rate decision. Dual-listed Israeli stocks are also anticipated to open lower, with Tower Semiconductor, Nova, and Camtek expected to fall between 4% and 7%. Conversely, Nice is projected to rise over 4%.

In the US, Federal Reserve Chair Jerome Powell's hawkish remarks at Jackson Hole have increased the likelihood of a September interest rate hike, with Barclays now predicting two hikes by year-end. This has led to a rise in US Treasury yields, making bonds a more competitive investment against stocks. The upcoming US jobs report will be a key focus for investors.

Commodity markets are seeing oil prices surge due to the US-Iran conflict. Gold prices have fallen as expectations of a US rate hike increase. The Israeli Shekel has slightly strengthened against the dollar.

Economists in Israel are divided on the Bank of Israel's next interest rate decision, with inflation moderating but concerns about the strengthening shekel and widening yield gaps with the US. The Bank of Israel may opt to keep rates unchanged amidst regional uncertainty.

In corporate news, Mitronics reported a decline in revenues and a net loss in its second quarter, announcing a further efficiency plan. Morgan Stanley has initiated coverage on SpaceX with an "overweight" rating, citing its Starbase project and potential for significant upside.