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Markets React as Gaza Ceasefire Brings Calm

Ceasefire Boosts Confidence in Global Trade October 13, 2025
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Changes in the Market are on display Markets respond to calm: Israeli equities rebound amid ceasefire optimism.

Good Morning,

Markets are hitting new highs as a Gaza ceasefire sparks a wave of optimism across global equities. Israel’s benchmark index jumped nearly 2%, and oil prices eased as traders priced in lower geopolitical risk. We unpack how this truce is shaping investor sentiment, what it signals for regional stability, and why energy markets may not stay quiet for long.

Markets also rebound as Trump tempers his China tariff rhetoric, the U.S. government shutdown extends into a 12th day with looming layoffs, and the Nobel Prize in Economics honors scholars for pioneering research on innovation led growth.

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– Truly yours, Fred Frost


πŸ“‰ Friday's Market Recap

Friday saw Wall Street take a brutal hit as U.S.-China trade tensions flared with Trump’s 100% tariff threat on Chinese imports, dragging the S&P 500 down 2.71% for its worst day since April. The Dow fell 1.9%, and Nasdaq tumbled 3.6%, fueled by fears of supply chain chaos over rare earth controls. Here’s what moved the needle.


  • Trade War Fears Erupt: Trump’s tariff threat after China’s rare earth export curbs sparked a massive sell off across indices. β†’ Fortune

  • Market Sentiment Sours: Deutsche Bank noted extreme sensitivity to U.S.-China trade developments, amplifying Friday’s losses. β†’ Seeking Alpha

  • Asian Markets Skid: Following Wall Street’s rout, Hong Kong’s Hang Seng dropped 1.5%, with broader Asian declines. β†’ ABC News



πŸ“‰ Daily Performance Snapshot

Index/Asset Closing Value Change
S&P 500 6,552.51 -2.71%
Nasdaq 22,204.43 -3.56%
Dow Jones 45,479.60 -1.9%
Gold $4102.40 +2.55%
Crude Oil $59.91 +1.71%
Bitcoin $114,250 +2.3%
10-yr Treasury Yield 4.051% -2.34%

πŸ”­ What to Watch Today

Today’s docket is packed with events that could sway markets, from policy remarks to economic deadlines amidst ongoing trade and shutdown concerns. Keep your eyes peeled for these developments.

  • Federal Reserve Remarks: Investors await Fed officials’ comments for clues on potential late 2025 rate cuts amid inflation worries. β†’ Benzinga
  • IRS Tax Deadline (Oct 15): Despite the government shutdown, the IRS extension filing deadline looms, with penalties for late filers. β†’ Finance Monthly
  • U.S.-China Trade Updates: Any further statements from Trump or Beijing could jolt futures after weekend de-escalation signals. β†’ Fox Business

  • πŸ’‘ Opportunity Watch

    Amid trade spats and policy shifts, a few corners of the market are flashing potential for savvy investors. Here’s where to look.

    • NioCorp Developments (NB): Shares spiked 14% pre-market on a record $162.8M cash balance, despite losses, signaling critical mineral upside. β†’ Benzinga
    • Critical Mineral Stocks: Trilogy Metals and MP Materials rallied on U.S.-China rare earth tensions, with domestic production focus. β†’ Stocktwits
    • Boeing (BA): Stock surged 15% pre-market as Trump eyes using it as a trade negotiation lever with China. β†’ Stocktwits

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    πŸ”₯ The Big Bullet

    Gaza ceasefire lifts Israeli markets and boosts investor confidence

    What happened: After Israel and Hamas agreed to a Gaza ceasefire, the Tel Aviv Stock Exchange surged nearly 2%, with the TA-125 index climbing to 3,327 and the TA-35 rising to 3,250. Investors reacted positively to news of de-escalation, signaling reduced geopolitical risk. Confidence strengthened further as fund managers in Israel noted rising inflows into local equities, a stronger shekel, and easing bond yields. The rally followed weeks of uncertainty tied to conflict in Gaza and came amid broader optimism for a stable truce.


    Why it matters: The ceasefire reduced Israel’s perceived risk premium, encouraging global investors to re-enter its markets. A firmer shekel and lower bond yields suggest improving economic sentiment, potentially easing inflation pressure and funding costs. For long-term investors, this reflects a shift from defensive assets toward equities. The development also has regional implications, global trade routes affected by Middle East tensions could gradually normalize, improving logistics and reducing energy-related volatility. In short, calmer geopolitics may support both Israel’s domestic growth and global market stability.

    What’s next: Investors will watch how durable the ceasefire proves in the coming weeks. Renewed clashes could quickly reverse market gains and strengthen the dollar again against the shekel. Energy traders are monitoring crude prices closely after oil settled lower following the truce, as traders priced in lower geopolitical risk. Policymakers in Israel may also face calls to capitalize on market calm to attract more foreign investment and stabilize inflation expectations. For now, the balance of peace and profit remains fragile but promising.


    Reader Feedback

    Last week, in regards to the U.S. bailing out Argentina, results were very much mixed, with the majority of you at 40% agreeing "It's about politics, not economics"

    Jonathan from Idaho wrote in: β€œThis might work for them for now, but not forever. If they don't solve their own problems, they'll just end up in trouble again later.”

    As always if your opinion is not here, or you want to throw your two cents at me, reply to the E-mail, and let me know your exact thoughts.


    🧭 Policy & Market Ripples

    • Trump Softens China Tariff Tone: After Friday’s 100% tariff threat, Trump’s weekend Truth Social post calmed markets, lifting futures 1-2%. β†’ The Guardian
    • Government Shutdown Drags On: Now in its 12th day, VP Vance warns of deeper federal layoffs, with 4,000 jobs on the chopping block. β†’ Fortune
    • Nobel Economics Prize Awarded: Joel Mokyr, Philippe Aghion, and Peter Howitt win for innovation-driven growth research, cautioning against protectionism. β†’ ABC News

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