When the World Shakes, Markets Reroute, LFG Daily - June 13th, 2025
Israel strikes, oil pops, gold rallies—and smart investors reposition instead of panic. Geopolitical risk is back. Here's what to avoid—and where to lean in.
🧨 LFG Daily – June 13, 2025
No bull. No spin. Just real talk on money and power.
📉 Market & Economic Pulse
Global markets slid as Israel launched strikes into Iran—risk appetite evaporated. U.S. futures dropped ~1.5%, Europe’s STOXX -1.4%, FTSE -0.5% .
Cyclicals & industrials that rely on global supply chains saw broad weakness, as conflict risk choked investor sentiment.
Defense stocks rallied on safe-haven demand, with U.S. contractors (e.g., Lockheed, Northrop) and global counterparts gaining.
Airline shares cratered due to flight route disruptions, rising fuel prices, and regional airspace closures—U.S. carriers slipped 4–5%, while European names like Lufthansa and Air France dropped similarly.
Oil exploded ~9% to ~$75.50/barrel amid supply fears, the largest one-day jump since 2022 . Gold rallied, nearing $3,430/oz, while the dollar and treasuries rallied as investors fled to safety.
Labor drag persists: Weekly jobless claims stayed elevated at 248,000, marking an eight-month high—another signal of a cooling labor market, as we talked about yesterday.
🌐 Geopolitics & Trade
Middle East meltdown: Israel’s strike at Iran’s nuclear/military sites triggered drone retaliation and spiked energy prices . Markets fear escalation could spark stagflation… I still don’t think stagflation is in the cards, yet.
Brent crude spiked ~12% intraday to ~$78.5, settling around $75—marking the largest one-day jump since 2022.
Key risk: Oil traders are now fixated on the Strait of Hormuz—an energy chokepoint handling ~30% of global seaborne oil—raising fears of tanker or port disruptions
Fed path disruption: Soft inflation and labor reports bolstered rate-cut bets, but now the Fed's runway is complicated by geopolitical headwinds.
Trade tension remains: U.S.–China truce is fragile while President Trump hints at new tariffs targeting Europe ahead of the G7—risking further disruption .
U.S. Politics & Society
• G7 heads to Canada, with Treasury Secretary Bessent and Trump in attendance amid the trade-terror mix.
• Oil and gold exporters including Canada saw futures dip as energy and metal volatility fluctuations fueled uncertainty.
🧠 LFG Hot Takes — Crafted for Calm & Clear Action
Inflation is soft, but geopolitics just rebooted risk. Pay attention to Oil Prices.
Markets are torn between dovish data and hawkish headline risk. Energy producers like Exxon (XOM) and Chevron (CVX) typically pop on such supply jitters, but the threat of escalation means volatility could ripple through.Refiners face inconsistent margins—uncertainty may compress crack spreads even as feedstock costs surge.
Defense spending doesn't wait for headlines to cool down. With global instability rising, nations are re-arming. That means long-term contract revenue for defense firms—regardless of market noise. Build or reinforce exposure to names like LMT, RTX, and NOC. You’re not betting on war—you’re hedging policy uncertainty and geopolitical fragility.
Oil shock = stagflation alert—but also opportunity.
Energy prices surge and send inflation signals. Hold real assets, consider opportunistic energy exposure, and lock in protections against economic drag.Geopolitical risk is getting priced in fast, but this isn’t 1973. The U.S. is energy independent, and SPR reserves are in play.
Flight to safety is a signal—use it.
U.S. dollar, treasuries, gold—they're flashing on the dash. Use safe-haven strength to rebalance into undervalued cyclicals once clarity returns.. but don’t be too quick.Gold surged ~1%, approaching record highs as risk sentiment surged.
Treasuries & Dollar: U.S. bond prices jumped (yields down ~10 bps), and the dollar strengthened as global investors sought refuge.
Trade chatter won't cut it.
Truces without terms = no resolution. Maintain exposure to global markets via EM or currency hedges, but position tactically until hard news arrives. Weakening dollar should help other currencies, and ultimately, international stocks. Maintain that posture.
🧭 Strategic Playbook
Energy & Defense: Tactical overweight—momentum from oil & risk repricing.
Utilities: Hold or build position for income and stability amid volatility.
Airlines: Trim or hedge—fuel margins squeezed and travel risk increased.
Gold & Miners: Add exposure as geopolitics remain fluid.
📌 Bottom Line: Today’s tension is tomorrow’s strategic rebalance. Calm your position, thread the needle between yield and defense, and stay flexible for the next surge in clarity. Align with big-picture macro: AI, defense, domestic infrastructure, and yield plays. Ride the waves, but keep your eyes on the tide.
— Luke Lloyd, Lloyd Financial Group
Sources:
https://www.reuters.com/world/middle-east/view-stocks-oil-sell-off-israel-strikes-iran-2025-06-13
https://www.theguardian.com/business/live/2025/jun/13/oil-surges-stock-markets-dollar-airlines-israel-attack-iran-business-live
https://www.reuters.com/business/take-five/global-markets-themes-graphic-2025-06-13
https://www.reuters.com/world/china/oil-prices-jump-more-than-4-after-israel-strikes-iran-2025-06-13
https://www.reuters.com/world/africa/dollar-other-safe-havens-rise-israel-strikes-iran-2025-06-13
https://www.reuters.com/world/china/gold-tops-1-month-high-middle-east-tensions-spur-safe-haven-demand-2025-06-13
https://www.reuters.com/world/us/us-weekly-jobless-claims-steady-higher-levels-2025-06-12
https://www.reuters.com/business/us-stock-futures-fall-after-israel-attacks-iran-2025-06-13
https://www.wsj.com/livecoverage/stock-market-today-trump-tariffs-trade-war-06-13-2025?gaa_at=eafs&gaa_n=ASWzDAhb0X0YtFCUSud5MSas7NAK0mi_kLiAIsSIEuZCZRe__iL9Q0vOmUWt&gaa_sig=vTOXJVJK2xFteLzCJ9PKfrB_vEjdbDIZgq3OeNMyyQISEOW5RvJzpApog6w2i1U02tAX_P6YRzPSydypmFJwtg%3D%3D&gaa_ts=684c1dd1&utm
https://finance.yahoo.com/news/oil-prices-jump-more-4-004505403.html
https://m.economictimes.com/news/international/world-news/us-weekly-jobless-claims-steady-at-higher-levels/articleshow/121807738.cms
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