It’s been a lackluster year so far for U.S. equities. Year-to-date, the benchmark S&P 500 is slightly in the red, weighed down primarily by a selloff in mega-cap technology. What began as a pause in leadership has evolved into broader volatility, and now, geopolitical tensions are adding another layer of uncertainty.
Over the weekend, a joint U.S.-Israel mission targeting Iran significantly escalated tensions in the Middle East. In response, markets have begun pricing in higher risk. Brent crude is trading near 52-week highs, the U.S. Dollar Index appears to have carved out a short-term bottom, and the CBOE Volatility Index (VIX) is attempting to break out of a prolonged consolidation range.
