Q2 Closing & Global Crises: Markets Navigate Geopolitical Shifts, ETF Outflows, and the AI Infrastructure Strain

Monday, June 29, 2026 | Daily briefing on volatile Q2 closings, the Hormuz ceasefire, massive spot ETF outflows, and the AI infrastructure strain.

Core Agenda

We are starting the week with heavy news from the weekend: incidents flared up again in Hormuz involving Iran, the US struck 10 targets, a destruction threat came from Trump, and then a ceasefire resumed. The market is now accustomed to this scenario. BTC is at $60,100. Spot ETFs experienced their highest monthly outflow in history in June at $4 billion. And this week, the final days of Q2, the ECB Forum, and key employment data are on the agenda.

Iran-US tensions escalated over the weekend and settled down again. On Saturday, Iran attacked a Panama-flagged tanker in the Strait of Hormuz, which was carrying over 2 million barrels of crude oil. The US struck 10 Iranian military targets around Hormuz on Sunday morning. Iran retaliated by targeting US bases in Kuwait and Bahrain with missiles and drones. Trump posted on Truth Social: “United States aircraft have struck 10 Iranian military storage facilities and coastal radar positions around Hormuz. The situation may reach a point where we can no longer act reasonably and may have to militarily complete the job we successfully started. If this happens, the Islamic Republic will cease to exist.” By Sunday evening, both sides agreed to a ceasefire again; talks will continue in Qatar this week. According to the ceasefire, both sides will withdraw, and ships will be allowed free passage. The market’s reaction summarizes this: S&P 500 futures +0.6%, Nasdaq futures +0.7%, crude oil rose slightly, but there is no sharp movement. Markets are now used to the fluctuations in US-Iran talks.

Second, spot Bitcoin ETFs recorded their largest monthly outflow in history in June. According to SoSoValue data, US-listed spot BTC ETFs saw a net outflow of $4.06 billion this month, marking the largest monthly outflow since their launch in January 2024. The previous record was $3.56 billion in February 2025. Last week alone saw $1.79 billion in outflows, the second-highest weekly outflow since trading began. Combined with May’s $2.43 billion outflow, the total for the last two months is nearing $6.5 billion. Since ETFs are considered the pulse of institutional demand, this data indicates that institutions have been systematically moving away from BTC throughout 2026.

Third, Bitcoin is about to close the second quarter of this year in the red as well, something that has only happened twice in its history. BTC is down approximately -22% in Q1 and about -12% in Q2. Closing the first two quarters of a year back-to-back in the negative is extremely rare in BTC history. Historically, the second quarter of the year has been one of BTC’s strongest periods; this time, that pattern was broken. Ethereum’s outlook is even heavier: Q1 -29%, Q2 -25%. Evaluating the first half as a whole, BTC lagged behind almost all major asset classes with a decline of approximately -30%; MicroStrategy (MSTR) performed even worse at -45%.

Fourth, there is a deep divergence of opinion in the market regarding Bitcoin’s bottom. Samson Mow argued in an X post on Sunday that Bitcoin’s bottom is already in. His reasoning: BTC reached its historical peak 37 days before the April 2024 halving, indicating that the cycle has accelerated and invalidates traditional four-year analysis. On the other hand, views vary. Markus Thielen from 10x Research sees the bottom at $55,000 within the August-October window. BitMEX co-founder Arthur Hayes points to $40,000 over the next six months. CoinDesk analyst James Van Straten highlights the indicator based on the 200-week moving average: he notes that while BTC fell below the realized price in every major bear market since 2011, it has not yet tested that threshold in this cycle. “The $50,000-$54,000 band could be the next critical battlefield.”

The AI fatigue theme remains mainstream in the markets this week. Investors are experiencing AI fatigue. They are questioning whether the heavy spending by hyperscalers on AI infrastructure will pay off; they fear the process of creative destruction, where new technologies quickly render existing ones obsolete. BofA Global Research describes this as a structural rotation: a shift from mega-cap AI to smaller, more cyclical segments. Supporting this view, the BIS issued a warning: rising debt levels and doubts over the sustainability of AI investments are increasing global risks.

The memory crisis is hitting small firms much harder than large ones. Apple and Microsoft can pass memory costs onto the consumer; small firms do not have this luxury. GoPro announced this month that it faces a risk of shutting down as memory costs increased by 80-115% in the first quarter. Shares of speaker manufacturer Sonos fell -23% this year as memory price pressure squeezed margins. On the other hand, Samsung and SK Hynix rebounded this morning after a sharp one-week drop: the two companies announced a plan to invest 800 trillion won ($518 billion) to build four new factories around Seoul within five years. The market initially met this with selling over fears of increased supply, but later repriced it as a strong investment signal.

Macro Framework

Fed: Market Now Pricing in Rate Hikes

The picture has fundamentally changed since last week. According to CME FedWatch, the market is now pricing in a rate hike for this year; this represents a sharp turn from the beginning of the year, which opened with expectations of two cuts prior to the Iranian war. Tightening expectations continue to support the dollar; the dollar index is near its one-year high at 101.33. A partial window of relief could open this week: if ADP and non-farm payroll data come in below expectations, there could be a short-term softening in the Fed narrative.

Yen at 161.77: At the Doorstep of Intervention

The Japanese yen is at 161.77, just 19 pips away from its 40-year low of 161.96. Japan intervened in the market in April-May, but as seen in the 2022 and 2024 examples, this intervention was not enough to reverse the yen’s direction. As long as the expectation of Fed rate hikes persists, there is no structural reason for a permanent recovery in the yen unless the BOJ takes a dramatic step.

ECB Forum Begins in Sintra

Described as the European Central Bank’s own Jackson Hole, the ECB Forum began today in Sintra, Portugal. ECB President Christine Lagarde is delivering the opening speech. The main panel, to be moderated by Sara Eisen on Wednesday, will be the most critical moment of this week for central banking. The forum meets right on the heels of the BIS’s warnings regarding rising debt levels and AI sustainability, which could shape the tone of the forum’s discussions.

Climate and AI Data Centers: A New Risk

Europe’s record-breaking heatwave is straining the power infrastructure of AI data centers. The burden that air conditioning demand places on the grid causes blackouts, and blackouts disrupt data center services. According to data from Zurich Insurance, extreme weather events have been the largest source of losses in the US data center construction portfolio over the last three years, now accounting for one-third of corporate losses. A new dimension is being added to AI infrastructure debates: not cost and competition, but physical resilience.

Crypto

On Monday morning, crypto markets showed complete indifference to the Iranian ceasefire. BTC is around $60,100. Last week, BTC dropped below $60,000 and is closing the quarter down -6.8% weekly. This picture remained unchanged despite the new attack in Hormuz on Friday night and the subsequent ceasefire on Sunday evening. This lack of reaction fits the pattern of the last two weeks: when the framework agreement was signed on June 19, BTC jumped, only to give those gains back due to a hawkish Fed and ETF outflows. The Qatar talks are being priced as a ‘maybe,’ not a ‘catalyst.’

The outlook for altcoins is mixed. ETH is recovering slightly to $1,572 this morning (+0.3%), but its weekly performance stands at -9.5%. SOL shows the most positive performance this morning at +1.5%; it had remained relatively resilient with a -3.5% weekly drop. Meanwhile, XRP and DOGE continue to fall. DOGE fell to $0,073 with a weekly loss of -11.7%, and XRP dropped to $1.04 (-8.7%). Hyperliquid’s HYPE token pulled back sharply by -10.6% weekly. TRON became the most resilient asset, down only -1.5% on the week.

The structural outlook remains unchanged. The $4 billion monthly ETF outflow, a -30% performance in the first half of the year, and two consecutive poor quarters: all convey the same message—institutional buyers have not returned yet. Until this picture reverses, short-term recoveries will hit a structural ceiling.

Commodities Environment

Oil: Renewed Tension, But Market Is Cautious

WTI fell below $70 over the weekend for the first time since the outbreak of the Iran war on February 28. Following the ceasefire on Monday morning, WTI is trading in the $69.52-$70.06 band, while Brent is in the $71.90-$72.47 range.

ING Strategists: “Market participants seem overly optimistic regarding the recovery timeline of Gulf oil flows. The developments this weekend highlighted the risks that the oil market still faces. Nevertheless, participants are ignoring these developments and focusing on what the flow recovery will mean for the global balance. This complacency is peculiar and harbors a significant upside risk if the supply recovery remains slow or if a severe re-escalation occurs.”

Gold: Fourth Consecutive Monthly Loss, Sharpest Since Q2 2013

Spot gold is hovering around $4,051-$4,057 (-0.8%), while futures are at $4,068-$4,072. Gold is experiencing its fourth consecutive monthly loss and is recording its sharpest quarterly decline since 2013, down -13% in Q2. While the fragility of the ceasefire pushes oil prices up, it keeps inflation concerns alive, which keeps non-yielding gold under pressure.

KCM Trade: “Gold could see $5,000 again this year, but this would be shaped on the basis of further de-escalation, a sustainable return of oil to pre-war levels, and a softening dollar.”

Spot silver is down -0.9% at $58.64. Platinum is up +0.1% at $1,616.55, and palladium is up +1% at $1,221.29.

Equities Front

Last Week’s Legacy: Tech Sell-off, Defensive Rotation

The Dow Jones closed up +0.6% last week, led by Merck (+13%) and Johnson & Johnson (+11.5%). In contrast, the Nasdaq Composite fell -4.6% and the S&P 500 declined by about -2%. Nvidia and Alphabet dropped over -8%, while Meta, Apple, and Amazon each lost more than -4%. SpaceX saw the sharpest decline of the week, dropping -17%. This picture bears the tracks of the rotation identified by BofA: a systematic shift from mega-cap AI to smaller and cyclical sectors.

Futures are recovering on Monday morning: S&P 500 +0.6%, Nasdaq-100 +0.7%, Dow +0.3%. Asia is mixed: Nikkei -0.8%, Kospi -1.48%, Hang Seng +2.13%. Samsung and SK Hynix recovered from their initial sharp declines following their announced $518 billion investment plan.

Two critical agendas for the market this week: SpaceX entering the Nasdaq-100 after July 6 will trigger technical buying from index-tracking funds. The NYT report stating that OpenAI is considering postponing its IPO to next year had pressured chip stocks last week; developments on this matter will continue to be monitored. The FT report regarding Google restricting Meta’s use of Gemini shows one dimension of inter-company tension within the AI ecosystem.

Evaluating June as a whole: S&P 500 -3%, Nasdaq -6%, Dow +1%. If the month is to be read in terms of leaders and losers: defense, healthcare, and small companies; against mega-cap AI and memory-dependent hardware companies.

This Week’s Calendar

Date	Day	Event
June 29	Monday (Today)	Final trading days of Q2; S&P 500 down -3% in June, Nasdaq down -6%+
June 29	Monday (Today)	ECB Forum Sintra begins: Opening speech by Lagarde
June 29	Monday (Today)	US-Iran technical talks in Qatar this week
June 30	Tuesday	Last trading day of Q2: End-of-quarter institutional portfolio flows
This Week	Wed–Thu	ECB Forum Sintra continues
This Week	Thursday	ADP employment data and US June Non-Farm Payrolls (NFP)
July 6	Monday (Post-market)	SpaceX enters Nasdaq-100, technical buying expected from index funds