Top U.S. Stories

  • The Trump administration announced sweeping new sanctions on Iran, which Treasury Secretary Scott Bessent described as an “economic onslaught,” restricting roughly 60 entities tied to Iranian oil revenue networks and its so-called “shadow fleet” of tankers. Why it matters: Markets had braced for even harsher measures targeting the Strait of Hormuz, so oil prices fell sharply on the relief — a reminder that geopolitical risk pricing can swing fast in either direction.
  • Iran and Oman reached an understanding on a temporary shipping route for the Strait of Hormuz, while technical talks continue on a permanent corridor.
  • The Federal Reserve held its benchmark interest rate steady at 3.5%-3.75%. June core PCE inflation was +0.1% month-over-month and +3.3% year-over-year. Why it matters: Fed Chair Kevin Warsh is due to speak during the August 27-29 Jackson Hole Economic Symposium, and markets will parse his remarks for clues on the path of rates.
  • Nepal’s Rasuwa district was hit by major flash floods on August 26 after the Bhotekoshi River burst its banks, sweeping away villages and a hydropower plant. Local police put the death toll at 95, with 384 tourists reported missing, including 291 foreign nationals. Neighboring Xigatse in China’s Tibet Autonomous Region reported 3 deaths and 265 people missing from related mudslides. Why it matters: The Nepali government has deployed the military for search and rescue, and Japan’s embassy says no Japanese nationals are known to be affected so far.
  • Nvidia reported fiscal second-quarter revenue of $96.2 billion, including $89.0 billion from its data-center business. Wall Street had closed mixed before the release: the Dow slipped, the S&P 500 was roughly flat, and the Nasdaq edged lower.

Markets

  • WTI crude: $80.52/barrel, down about 2.2%, as fears of a Hormuz supply disruption eased.
  • Dow Jones Industrial Average: closed at 53,463.88, down 113.52 points (-0.21%).
  • S&P 500: closed at 7,675.70, essentially flat.
  • Nasdaq Composite: closed at 26,130.20, down 0.08%.
  • USD/JPY: trading near 159-160 yen, with the yen approaching the psychologically important 160 level again amid dollar demand tied to Middle East tensions and speculation over the timing of the next Bank of Japan rate hike.
  • Nikkei 225 (Aug 26 close): 66,262.16 yen, up 405.73 points (+0.62%).

Stocks in Focus

  • Energy stocks swung on the sanctions news as traders repriced the odds of a Hormuz disruption.
  • Semiconductor and tech names face a fresh test after Nvidia reported $96.2 billion in quarterly revenue, including $89.0 billion from data centers.
  • Rate-sensitive financials traded cautiously ahead of Warsh’s Jackson Hole remarks.

Not investment advice — this is market commentary, not a recommendation to buy or sell any security.

Compass Insight

Today’s throughline is de-escalation that isn’t quite what it seems. New U.S. sanctions on Iran turned out milder than markets feared, sending oil sharply lower — good news for pump prices, in theory. But a weakening yen near 160 per dollar works in the opposite direction for import-dependent economies like Japan, potentially offsetting some of that relief at the register. It’s a useful reminder that energy costs for households are set by a tug-of-war between dollar-denominated commodity prices and currency moves, not either one alone. Short term, watch Warsh’s Jackson Hole remarks and the market reaction to Nvidia’s newly released results for the next directional cue on rates and tech valuations. Longer term, the tension between a Fed still fighting sticky inflation and a Bank of Japan edging toward tighter policy is one worth tracking — it shapes everything from mortgage rates to how far a paycheck stretches on imported goods.

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