Oil prices have fallen to pre‑war levels. AI companies continue to sell off

On Thursday, US indices showed mixed dynamics, reflecting a deep split between the overheated technology sector and the “traditional” economy. By the end of the day, the Dow Jones Index (US30) rose by 1.14%. The S&P 500 Index (US500) closed at its opening price. The Technology‑heavy NASDAQ Index (US100) closed lower by 0.80%. Semiconductor manufacturers (Micron, Applied Materials, AMD, SanDisk, Marvell) continued a second wave of sell‑offs amid doubts about the sustainability of AI‑company valuations, while the Dow Jones Index updated its historical high. The key driver of Dow’s growth was US employment data, which came in weaker than expected. This cooled market fears regarding immediate Fed tightening and offset negative sentiment.

European indices closed in the green on Thursday. By the end of the day, Germany’s DAX (DE40) rose by 2.16%, France’s CAC 40 (FR40) closed up 1.65%, Spain’s IBEX 35 (ES35) gained 1.37%, and the UK’s FTSE 100 (UK100) finished the trading session higher by 1.67%. On Thursday, the DAX 40 Index showed impressive growth, updating its historical high. The main driver of optimism was a large reform package from Friedrich Merz’s government, including tax relief for households and housing‑sector initiatives, which, combined with weakening hawkish expectations for Fed and ECB policy, created a favorable investment environment.

The US natural gas prices fell below 3.2 dollars per MMBtu amid oversupply and bearish dynamics in related energy markets. According to the EIA report, weekly storage injections reached 87 billion cubic feet, exceeding expectations and keeping inventories 6.2% above historical averages. Fundamental pressure is complemented by high production activity: output in the continental states remains near a record 110 billion cubic feet per day, while LNG export capacity is steadily loaded at 17.3 billion cubic feet per day.

Oil prices (WTI) fell by 2% to around 67 dollars per barrel, reaching pre‑war levels amid a sharp increase in shipments through the Strait of Hormuz, which exceeded 10 million barrels per day. The market is reacting to the recovery of export flows from the UAE and active releases of oil from reserves, which, along with one‑off sales by Saudi Arabia, form a persistent oversupply. Meanwhile, US domestic oil inventories have reached their lowest level since March 2025, reflecting the consequences of a twelve‑week period of continuous declines.

On Thursday, Japan’s Nikkei 225 (JP225) fell by 2.47%, China’s FTSE China A50 closed lower by 3.11%, Hong Kong’s Hang Seng (HK50) rose by 0.76%, and Australia’s ASX 200 (AU200) closed higher yesterday by 0.02%. Market optimism was driven by improved global risk sentiment after weak US labor‑market data, which reduced fears of further Fed rate hikes. Additional support for risk appetite came from falling oil prices amid normalization of shipping through the Strait of Hormuz, which eased inflationary pressure and created a favorable backdrop for a wide range of assets.

The Australian dollar is strengthening for the second session in a row, approaching 0.690 USD and ending the week in the green. Growth is supported by the hawkish interpretation of the minutes from the June meeting of the Reserve Bank of Australia: analysts at CBA and ANZ highlighted the regulator’s concern about excessive demand and capacity constraints, which signals persistent inflation risks despite market skepticism regarding further rate hikes.

The New Zealand dollar recovered to 0.570, breaking a prolonged downward trend and showing its first weekly gain in three weeks. The main catalyst for optimism was the weakening of the US dollar caused by disappointing US labor‑market data, which forced investors to revise expectations regarding aggressive Fed rate hikes. Positive dynamics for the kiwi are also supported by market anticipation of the Reserve Bank of New Zealand’s decision at the upcoming meeting. Despite expert discussions about the appropriateness of a pause in tightening due to falling global energy prices, market pricing reflects a roughly 78% probability of a rate hike.