We’re in Wait-and-See Mode
Observers are worried about a wider war.
At its peak on Friday the so-called “fear gauge” had spiked 28.77 percent from its previous close. The CBOE Volatility Index $VIX ended the day up just 16.10 percent, but we’re in a different phase than we were on Thursday.Friday’s VIX spike was caused by reports Iran was preparing an imminent attack on Israel, and the Islamic republic followed through over the weekend. Its attack was both well-telegraphed and well-defended, with limited effects inside Israel.
According to The Wall Street Journal, Iran fired approximately 350 drones and cruise and ballistic missiles with approximately 60 tons of warheads and explosive materials from sites in Iran, Iraq, Yemen, and Lebanon.
A spokesman for the Israeli military said nearly all the drones and missiles were shot down before they reached Israel or otherwise failed to reach their targets.
Israel’s war cabinet met on Sunday but did not say how it would respond to what was Iran’s first-ever attack on Israel from bases inside its own borders.
According to a senior White House official cited by Axios, President Biden, pressing for a diplomatic solution, told Israeli Prime Minister Benjamin Netanyahu on Saturday that the US will not support any Israeli counterattack against Iran.
The US said that the UN Security Council has a collective responsibility to ensure Iran complies with its resolutions and ceases its violations of the UN Charter.
Deputy Ambassador to the UN Robert Wood said in a statement to the council that in the coming days and in consultation with other member states, the US will explore additional measures to hold Iran accountable at the UN.
This is a light week for economic data, US retail sales data for March out at 8:30 a.m. ET today and housing starts, building permits, and home sales data coming too.
And Federal Reserve Chair Jerome Powell will participate in a moderated discussion with Bank of Canada Governor Tiff Macklem at the Washington Forum on the Canadian Economy tomorrow at 1:15 p.m. ET.
But the thing this week is geopolitics.