Thursday, August 6

The Strait of Hormuz moved back to the center of cross-asset pricing after Iran pushed to restrict U.S. and Israeli vessels, lifting oil and pressuring U.S. equities. The Dow fell nearly 0.9%, ending a five-day winning streak, as energy-supply risk collided with already restrictive central-bank messaging.

The significance is less the day’s equity decline than the transmission channel: a sustained threat to a key shipping route would reinforce imported inflation, make rate cuts harder to justify, and raise the discount rate applied to growth and technology assets. Bloomberg and Reuters coverage also tied recent AI and semiconductor trading to this macro backdrop rather than purely company-specific fundamentals. Venezuela’s government-opposition talks, noted in Reuters market calendars, added a secondary sanctions and oil-market angle but remained well behind the Iran conflict in immediate importance.

The Reserve Bank of India kept its repo rate at 5.25% for a fourth consecutive review and retained a neutral stance. Governor Sanjay Malhotra’s MPC is waiting to see whether higher energy costs linked to the Iran war pass through to inflation, leaving rate-sensitive Indian sectors without a fresh policy tailwind.

Mexico’s central bank likewise held its policy rate at 6.50%, extending a pause that began in June and effectively ending its more than two-year easing cycle for now. Together, the decisions show how the energy shock is broadening beyond oil markets into emerging-market policy constraints. The Fed’s 3.50%-3.75% target range and hawkish commentary from Fed Governor Musalem reinforced the same message, although the next genuinely market-moving U.S. test is Friday’s July Employment Situation report.