UBS On-Air: Paul Donovan Daily Audio 'Optimistic bias versus bad news'

The collapse of Iran-US talks predictably pushed oil prices higher and equities lower. US President Trump declared an “immediate” blockade of Hormuz—the US military clarified “immediate” means from 1400 GMT today, and “blockade” means ships using Iranian ports. If successful, this would stop Iranian oil supply (primarily to China). Markets’ optimistic bias remains; oil prices are nowhere near levels to cut demand circa 15%, and Asian equities reversed only part of the ceasefire rally.