Stocks and gold wobbled on Trump’s Iran and tech war suspense

·       Iran war may linger more than two weeks; Oil may gain as Iran rejects further talks with the US unless Israel stops the aggression

·       China may be actively supporting Iran in terms of military hardware & software (satellite data)

·       Israel may soon run out of its interceptor missile stockpiles amid the barrage of Iranian missiles

·       Israel and the US may find it tough to manufacture fresh interceptor missiles on China’s monopoly and export control over military-grade rare earth materials

·       Trump may again invoke high-end chip tech export restrictions for US MNCs operating in China

On June 18, after the Fed’s hawkish hold, Wall Street Futures were almost flat, but the USD recovered from the initial knee-jerk downward reaction, while Gold stumbled. Fed projected a slower rate cuts trajectory for 2026-27, which is seen as a hawkish hold. But the market is now dancing to Trump’s Iran tune. On early Thursday, June 19, Wall Street Futures slipped on lingering Iran war uncertainty; Gold recovered to some extent in a holiday-thinned trade.

Early Friday: Wall Street Futures gained on ease of Iran war tensions; Gold, oil slips

In the early Asian session on Friday, June 20, Wall Street Futures surged, while USD, Gold, and also oil slumped as Trump delayed the Iran war participation decision by two weeks. There was also another unconfirmed report indicating Iranian Supreme Leader Ayatollah Khamenei may have been killed or seriously injured in an Israeli missile strike on a bunker in Lavizan locality, Tehran, late at night. Some unverified social media posts and reports suggest the attack targeted a location where Khamenei was reportedly hiding, with some claiming he did not survive or was trapped due to destroyed air vents. However, these claims remain entirely unconfirmed by any official or independent sources.

Official reports indicate Khamenei was moved to a bunker in Lavizan earlier in the conflict, and he delivered a televised address on June 18, 2025, vowing defiance. No credible evidence supports claims of his death as of June 20, 2025. Earlier rumors of his death, such as those on June 13, were debunked by sources like Reuters, confirming he was alive and being briefed. In a way, by the June 20 US sessions, it seems that the earlier chatter of Khamenei's death may be not true; Wall Street Futures stumbled to some extent, while Gold got some boost.

Iran war may linger beyond two weeks:

The ongoing mini-war between Israel and Iran, escalating since Israel’s strikes on Iranian nuclear and military facilities beginning June 13, 2025, has entered a critical phase, with significant developments reported as of June 19, 2025. The conflict intensified after Israel launched a surprise offensive on June 13, 2025, targeting Iran’s nuclear facilities, including centrifuge production sites at Natanz, and military targets, killing over 200 people, including senior Iranian military commanders and nuclear scientists. Iran retaliated with over 400 ballistic missiles and 1,000 drones, with some penetrating Israeli defenses, killing at least 24 and injuring hundreds. Israel’s strikes have continued, hitting Tehran, Arak, and other sites, with the stated goal of degrading Iran’s nuclear and missile capabilities.

An unidentified IDF official also confirmed that its Iron Dome missile defense system is now able to defend around 65% of Iranian missiles from earlier 90% due to various issues and inadequate interceptor missiles. This means that out of 100 missiles & drones being fired by Iran, almost 40 can hit Israel targets/grounds directly. Iran is now firing various types of advanced ballistic/cruise and hypersonic missiles and Israel has also suffered significant civilian damage/casualties unexpectedly. Israeli public is now in a panic state, something which is very rare and Israeli PM Netanyahu is now on the back foot, at least on the domestic political front.

As of June 19, 2025, Israel conducted further airstrikes on Tehran, targeting weapons production facilities and nuclear centrifuge plants, while Iran launched missiles that struck Soroka Medical Center, a major hospital in southern Israel. Iran’s supreme leader, Ayatollah Ali Khamenei, has vowed a decisive response to any U.S. involvement, while Israel claims its actions have set back Iran’s nuclear program by months. The Iran war has caused significant civilian disruption. Tehran residents are evacuating amid heavy bombardment, with schools and mosques opened as shelters. Israel’s airspace closure has stranded thousands, and Iranian missile strikes have caused fires and casualties in Israel.

Diplomatic Uncertainty:

The prospect of negotiations appears slim, given Iran’s insistence on a ceasefire and Israel’s refusal to halt its campaign. Trump’s openness to talks may be a rhetorical gesture to appease domestic and international audiences wary of U.S. involvement in another Middle East war.

On early Friday, June 20, Iranian Foreign Minister Araghchi announced Iran’s rejection of a U.S. request for negotiations at ‘gunpoint’, accusing the US of already being involved in Israel’s ongoing strikes against Iran. Araghchi also clarified that Iran’s discussions with the UK, France, and Germany (E3) would focus solely on its nuclear program, not its missile capabilities, emphasizing Iran’s commitment to “legitimate self-defense.” This focus likely responds to international concerns about damage to Iran’s nuclear facilities, such as Natanz, following Israel’s strikes, and IAEA reports confirming limited impact on Fordow.

By excluding missile capabilities from the talks, Iran is drawing a red line in discussing its retaliatory missile strikes (over 400 ballistic missiles launched against Israel since June 13), which it frames as self-defense. Araghchi’s assertion that Iran is engaged in “legitimate self-defense” and that this “will not stop” underscores Iran’s intent to continue missile and drone attacks in response to Israel’s campaign. Recent strikes, such as those hitting Soroka Medical Center in southern Israel on June 19, 2025, demonstrate Iran’s ongoing retaliatory capacity despite Israel’s efforts to degrade its missile production.

Iran war situation as of June 20, 2025:

As of June 21, 2025, the conflict remains active, with no immediate resolution in sight, raising concerns about a broader war involving major powers. Israel has conducted multiple waves of airstrikes since June 13, targeting Iran’s nuclear facilities (e.g., Natanz, where thousands of centrifuges were damaged), missile production sites, and military infrastructure, including command centers in Tehran and western Iran. On June 20, Israel struck a residential building in Qom, killing a 16-year-old and injuring two others. The Israeli Air Force (IAF) has deployed over 50 fighter jets, achieving air superiority by destroying Iran’s air defenses, including Russian-supplied systems. Israel’s stated goal is to dismantle Iran’s nuclear and ballistic missile capabilities, which it views as an existential threat.

Iran has retaliated with over 400 ballistic missiles and 1,000 drones, targeting Israeli military sites and cities like Tel Aviv, Haifa, and Beersheba. Strikes on June 20 hit civilian areas, including an Ottoman-era mosque in Haifa and Soroka Medical Center, causing at least 24 deaths and hundreds of injuries. Iran’s latest salvo on late June 20 triggered air-raid sirens across Israel, forcing millions into shelters. Iran claims its actions are “legitimate self-defense” against Israeli aggression.

Israel’s strikes have killed over 240 Iranians, including senior Islamic Revolutionary Guard Corps (IRGC) commanders, nuclear scientists, and civilians. Iran’s attacks have caused significant damage in Israel, with at least 24 deaths and 800 injuries reported. Both sides’ munitions stockpiles and sustainability remain unclear due to information warfare.

In Iran, panic and mass evacuations from Tehran and other cities continue, with schools and mosques opened as shelters. Roads out of Tehran are congested, and fuel shortages have been reported. In Israel, airspace closures have stranded thousands, and millions are under shelter orders due to ongoing Iranian missile barrages.

Nuclear Concerns: The International Atomic Energy Agency (IAEA) reported on June 13–14 that Israel’s strikes impacted Natanz’s underground infrastructure but caused no elevated radiation levels at Natanz or Esfahan. The IAEA condemned attacks on nuclear facilities, citing risks of radiological release. Iran insists its nuclear program is peaceful, despite allegedly amassing 409 kg of 60% enriched uranium, close to military (nuke) grade.

Summary

The Israel-Iran conflict remains volatile, with Israel’s ongoing strikes and Iran’s retaliatory missile barrages raising the stakes. The U.S., under Trump, is at a crossroads, with approved plans for potential strikes but no final decision as of June 20, 2025. Trump’s comments show a mix of aggressive posturing, demands for Iran’s surrender, and vague openness to diplomacy, though his timeline for a decision (within two weeks) suggests a critical period ahead. The risk of U.S. involvement drawing the region into a wider war remains high, especially given Iran’s threats and domestic U.S. opposition to another Middle East conflict.

On late Friday, June 20, Wall Street Futures slipped on lingering Iran war suspense after Iran rejected further negotiations with the US without a ceasefire, while Trump expressed his limitations in asking Israel, the ‘winning party’ to halt the war in response to the losing party. Wall Street was also affected by Trump’s tech war stance after a WSJ report:

The US prepares action targeting allies’ chip plants in China-WSJ

·       The US is considering revoking waivers for Samsung, SK Hynix, and TSMC to use American technology in China, as reported on June 20, 2025, by the WSJ.

·       This action is part of a broader crackdown on technology exports to China, potentially affecting diplomatic and economic relations.

·       The Commerce Department states chipmakers can still operate in China under new licensing requirements, but the final decision is pending as of June 21, 2025

·       The move seems likely to be a contingency if the recent US-China trade truce fails, with no current intention to implement it.

Context & Background:

The US is looking at tightening controls on semiconductor technology, focusing on major global chipmakers with operations in China. This follows ongoing tensions over technology, rare earth materials, and trade, with recent reports highlighting potential changes to how these companies access US technology. Jeffrey Kessler, from the Commerce Department, informed the companies of the potential waiver revocation, which could disrupt their operations in China. However, the Commerce Department has clarified that operations can continue under new rules, suggesting a balanced approach. This development comes shortly after a fragile trade truce with China, raising concerns about diplomatic fallout. As of June 20, 2025, no final action has been taken, and the situation remains under consideration, with the White House viewing it as a contingency plan (floating balloon in retaliation of any further export control of rare earth materials by China).

The semiconductor industry has been a focal point in US-China trade relations, given its critical role in technology and national security. The US has been implementing export controls to limit China's access to advanced semiconductor technologies, aiming to reduce dependence on foreign production and mitigate security risks. This context is crucial for understanding the recent move to potentially revoke waivers for major chipmakers operating in China.

The waivers in question are part of the Validated End User (VEU) program, which was established to facilitate the receipt of US-controlled products and technologies by trusted foreign entities. These waivers, granted in 2023 and 2024 following initial letters in October 2022, allowed Samsung, SK Hynix, and TSMC to ship American chip-making equipment to their factories in China without needing separate licenses each time. Revoking these would make it more difficult for these companies to receive US goods and technology, potentially benefiting domestic Chinese competitors like Yangtze Memory Technologies.

The proposed action involves new enforcement mechanisms that mirror licensing requirements applied to other semiconductor companies exporting to China, ensuring a reciprocal process. This was clarified in a statement from the Commerce Department, which emphasized that "Chipmakers will still be able to operate in China" under these new rules.

Companies Involved and Their Stakes

The companies targeted—Samsung (South Korea), SK Hynix (South Korea), and TSMC (Taiwan)—are significant players in the global semiconductor market. All have made substantial investments in the US and have cooperated in limiting technology transfers to China. For instance, Samsung's Xi’an plant has been able to produce advanced products competing with Chinese firms, thanks to its current US waiver. Revoking these waivers could impact their ability to compete globally, especially in China, where they produce semiconductors for various industries.

Official Statements and White House Position

The Commerce Department's statement, as reported by multiple sources, underscores that the move is not intended to halt operations but to align licensing with existing requirements for other exports to China. A White House official stated that the US is "just laying the groundwork" in case the trade truce with China falls apart, expressing confidence in the ongoing trade agreement.

This suggests the action is a contingency rather than an immediate escalation, aligning with efforts to maintain the fragile trade truce agreed upon earlier in London. If carried out, the revocation could be disruptive both diplomatically and economically. South Korea and Taiwan, key US allies, are negotiating broader trade deals, and this move could strain relations, especially given their cooperation in the technology race with China. The companies have notified authorities in their home regions, hoping for lobbying support against the move, indicating potential diplomatic pushback. The WSJ report and subsequent coverage, indicate that the discussions with the companies occurred this week, meaning within the last few days. As of the current date, no final decision has been made, and the action remains under consideration. Given the timing, it seems likely that any implementation would be subject to further negotiations and could depend on the stability of the US-China trade truce and China’s stance on rare earth materials export control.

The US is actively considering revoking waivers for major chipmakers' operations in China, reflecting ongoing tensions in technology and trade. While the Commerce Department assures continued operations under new rules, the potential diplomatic and economic implications remain significant.

Conclusion

As of June 20, 2025, the Iran-Israel war continues with no ceasefire in sight, driven by Israel’s campaign to dismantle Iran’s nuclear and missile capabilities and Iran’s retaliatory strikes. Iran conditionally supports diplomacy via the EU-3 but rejects U.S. talks, citing American complicity and credibility. Israel dismisses diplomacy without Iran’s complete nuclear capitulation. The U.S. is poised for potential military involvement but faces domestic and international pressure to avoid war.

Russia and China advocate de-escalation but lack decisive influence, while the EU-3 pushes for nuclear-focused diplomacy with limited success. Trump’s two-week deadline (by early July 2025) will be pivotal, with the risk of a wider regional conflict looming if diplomacy fails. Trump may be waiting for the end game-whether Israel or Iran is an advantage after two weeks. If Israel is at a disadvantage because of a potential shortage of interceptor missiles and China’s reluctance to supply military-grade rare earth materials to manufacture, then Trump may be able to force Israel into an immediate ceasefire to start the negotiation with Iran. Deal maker Trump always wants to be on the winning side, be it on the trade/tech war or the real/Iran war.

Market impact

Wall Street Futures slip Friday, June 20, on lingering suspense of Iran war China tech war tensions despite earlier positive sentiments on ease of Iran tensions. Wall Street was also briefly boosted by dovish comments of Fed’s Governor Waller, advocating the start of rate cut talks or even a 25 bps rate cut from July’25 instead of market expectations of September/October’25. Also, Friday’s “triple witching” expiration added volatility. On Friday, the S&P 500 edged down 0.2%, its third straight loss, while the Nasdaq-100 slumped 0.5% and the Dow Jones added 35 points. On the week, the S&P 500 fell 0.2%, while the Dow was flat and Nasdaq added 0.2%.

On Friday, Wall Street was boosted by energy (higher oil), consumer staples, financials, utilities, and industrials, while dragged by communications services, materials, healthcare, techs, and real estate.  US chip/equipment makers like NVIDIA, TSMC, KLA Corp, Lam Research, and Applied Materials dropped while Micron rose, reflecting market reactions to the WSJ news about a potential tech restriction. Gold and oil wobbled on Iran war tension escalation and de-escalation.

Technical outlook: DJ-30, NQ-100, Gold, and Oil

Looking ahead, whatever the fundamental narrative, technically Dow Future (CMP: 42600) now has to sustain over 42900 for a further rally towards 43200/43600*-44000/45300 in the coming days; otherwise sustaining below 42800, DJ-30 may again fall to 41900/41700-41400/41000* and further 40600/40100-39200/38000 in the coming days.

Similarly, NQ-100 Future (21600) has to sustain over 22000 for a further rally to 22400/22500-22700/23000 in the coming days; otherwise, sustaining below 21900, NQ-100 may again fall to 21900/20900-20700/20200 and 19890/18300-17400/16400in the coming days.

Technically Gold (CMP: 3350) has to sustain over 3375-3395 for a further rally to 3405/3425*-3450/3505*, and even 3525/3555 in the coming days; otherwise sustaining below 3365, Gold may again fall to 3340/3320-3300/3280 and 3255/3225-3200/3165* and further to 3130/3115*-3075/3015-2990/2975-2960*/2900* and 2800/2750 in the coming days.

Whatever may be the narrative, Technically Oil (78.00) now has to sustain over 81.00 for any further rally to 85.00/88.00-90.00/91.00-95.00; otherwise sustaining below 80.50/80.00-77.50/75.00, may fall to 69.00/67.00-65.00/64.00 and further fall to 62.00/60.00-57.00/55.00 in the coming days.