Earnings Outshine War Worries

Earnings resilience and AI optimism have driven equity markets higher, offsetting geopolitical risks from the Iran crisis and tight oil markets. US indices hit fresh record highs, boosting risk appetite and weighing on the dollar as yields eased (10‑yr <4.40%). In Europe the ECB’s hawkish hints revived euro bulls and helped the EURUSD clear the 100‑DMA, while the Stoxx 600 jumped on strong bank and energy earnings. USDJPY fell sharply after Japan signalled possible intervention, contributing to dollar weakness. Corporate results — notably Caterpillar’s strong top‑line beat and Apple’s better‑than‑expected quarter plus a $100bn buyback and dividend increase — supported markets. Overall, earnings have been the dominant market driver, keeping risk assets bid unless geopolitics deteriorates further.