Prospective peace talks in Doha soothe markets

Summary

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Podcast Summary: Moving Markets – Prospective Peace Talks in Doha Soothe Markets

Date: June 30, 2026
Host: Helen Frear (Julius Baer)
Guests: Bernadette, Dirko (Market overview), Carsten Menke (Future Cities)

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Episode Overview

This episode of Julius Baer’s Moving Markets podcast focuses on the market response to reduced Middle East tensions, with special attention to upcoming US-Iran peace talks in Doha. The episode also features an in-depth thematic discussion on the structural and investment implications of climate-driven heat waves and adaptation strategies in European cities—part of the long-term “future cities” theme.

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Key Market News and Insights

1. Middle East Tensions & Oil Market Reaction

• Hostilities in the Region:
  • The prior weekend saw significant US-Iran military escalation in the Strait of Hormuz.
  • Both sides agreed to a pause, allowing commercial shipping again ([00:41]).
• US-Iran Peace Talks:
  • President Donald Trump announced new talks in Doha, Qatar, aiming to maintain the ceasefire ([01:10]).
• Market Impact:
  • Oil: Brent crude rebounded from four-month lows to $73.15/barrel; WTI rose to $70.75.
  • Equities: S&P 500 +1.18%, Dow hits all-time high above 52,000. Notably, Alphabet replaces Verizon on the Dow, surging ~5% on the day ([01:42]).

Quote:

“Stocks rallied yesterday. This pause in hostilities clearly lifted sentiment. … The Dow jumped just shy of 0.6% and it closed at a record high above the 52,000 level for the first time ever.”
— Bernadette ([01:42])

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2. Asia Market Developments

• Performance:
  • KOSPI leads the region; up 3% in session, on track for a potential 105% YTD performance.
  • Japan’s Nikkei also up strongly (37% quarterly gain); Shanghai and CSI higher; Hang Seng lags (-1%) ([02:14]).
• Currency:
  • Japanese Yen at a 40-year low vs. USD (162.41/USD).
  • Japanese authorities signal readiness for intervention to counter excessive moves ([02:48]).

Quote:

“The Japanese Yen has today weakened to its lowest level against the US dollar in 40 years. … Japan's Finance Minister Satsuki Katayama said that the government is ready to take appropriate action.”
— Bernadette ([02:48])

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3. China Economic Updates

• Manufacturing PMI:
  • June index at 50.3 (vs. 50 in May), above forecasts—driven by AI-related tech demand; real estate and consumer goods still weak ([03:12]).
• Services PMI:
  • Also modestly improved, despite subdued demand.

Quote:

“The official Purchasing Managers Index edged up to 50.3 in June... it means it's returned to expansionary territory, which is good news.”
— Bernadette ([03:12])

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4. European Markets & Tech Rally

• Market Action:
  • Stoxx 600 closes flat (+0.1%). Tech stocks rise 1.2% after previous week's sharp decline.
  • European tech sector continues to outperform, buoyed by the global AI rally ([03:55]).

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5. Key Data Ahead

• Europe:
  • Flash June CPI from Germany, France, Italy; German unemployment ([04:34])
• US:
  • JOLTS report (May), Conference Board Consumer Confidence (June)
• Market Outlook:
  • Futures indicate positive or flat start in both Europe and the US ([04:57]).

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Thematic Focus: Future Cities & Climate Adaptation

1. Economic Costs of Extreme Weather

• Heat Waves & Natural Disasters:
  • Europe’s annual losses due to natural disasters have more than doubled: €13bn (1980-2014) to €30bn (2015-2024) ([05:32]).

Quote:

“Losses caused by natural disasters, I.e. heat waves, floods and storms, remain on the rise all over the world. In Europe, they amounted to more than 30 billion per year…compared to only 13 billion on average between 1980 and 2014.”
— Carsten Menke ([05:32])

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2. Urban Adaptation Strategies

• Sponge City Concept:
  • Focus on breaking up sealed surfaces, expanding urban greenery, storing rainwater for cooling and irrigation.
  • Combines ecological and economic benefits, reduces disaster costs, and boosts urban attractiveness ([06:16]).

Quote:

“To counter this threat, the sponge city concept has been developed. Its key features are to break up sealed spaces, to green the city and to store the rainwater in underground reservoirs…ultimately, sponge cities combine ecological and economic benefits.”
— Carsten Menke ([06:16])

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3. Heat Islands & Urban Design

• European Vulnerability:
  • Old, poorly insulated buildings raise risks; lack of urban greenery accentuates heat islands.
• Cooling Solutions:
  • Rapid growth in demand for heat pumps and AC systems, increasingly powered by renewables.
  • Air conditioning is shifting from environmental liability to “win-win” solution as solar generation rises ([07:08] – [08:55]).

Quote:

“Europe has never been very fond of air conditioners simply because there was no need given our mild climate. But this is changing as the need is changing…they are increasingly operating on solar power and also using more environmentally friendly coolants.”
— Carsten Menke ([08:18])

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4. Investment Implications

• Opportunities:
  • Strong prospects for companies focused on building efficiency, infrastructure upgrades, and clean energy solutions.
  • Future-proofing cities (+ equipment rental, consultancy, construction services) remains a key focus despite cyclical volatility from high interest rates and weak construction activity ([09:28]).

Quote:

“The structural outlook for building efficiency and technology companies remains very strong... this segment should have left the worst behind. And the same applies to [firms]…exposed to future proofing our cities, such as consultancy companies, construction companies, or equipment rental companies.”
— Carsten Menke ([09:28])

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Memorable Moments

• Dow milestone on Alphabet’s first day in the index: ([01:42])
• Record Yen weakness and intervention speculation: ([02:48])
• Callout to “sponge cities” and the evolution of European attitudes toward air conditioning: ([06:16], [08:18])
• Insight that negative power prices signal opportunities for solar-powered cooling: ([08:18])

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Timestamps for Key Segments

• Middle East Tensions & Market Reaction: 00:34–02:11
• Asian Markets & Yen: 02:12–03:05
• China Economic Data: 03:12–03:50
• European Market Recap: 03:55–04:28
• Data to Watch Today: 04:34–04:57
• Heat Waves & Future Cities: 05:06–10:12
• Investment Implications: 09:25–10:12

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Takeaways

• Markets are being soothed by reduced hostilities and prospective peace talks between the US and Iran.
• Sentiment is lifted across oil and equity markets; tech and AI remain strong drivers.
• Thematic investment in infrastructure for climate adaptation—sponge cities, building efficiency, and renewable-powered cooling—appears robust and increasingly relevant as Europe grapples with extreme weather trends.

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Transcript

[A]

Good morning, everyone, and welcome to Julius Baer's Moving Markets Podcast. It's Tuesday, the 30th of June, and my name is Helen Frear, filling us in on the latest in financial markets today. I will speak first of all this morning to Bernadette and Dirko. And my second guest today will be Carsten Menke and we'll be talking about the future cities topic. So that is coming up shortly. But over to you first of all, Bernadette, for the market news. Good morning.

[B]

Good morning, Helen.

[A]

Let's start with the latest in the Middle east, where tensions flared up again at the weekend. Where are we now? Benedet?

[B]

Yes, Helen, so we had this weekend of hostilities is the best way of saying it. In the Middle East. The US Struck Iranian military targets in response to Tehran's latest attacks on shipping in the Strait of Hormuz. Then on Sunday, the US And Iran agreed to halt their attacks and allow commercial vessels to pass through this strategically important waterway. On Sunday, a US Official said that both sides are going to stand down for now. Vessels can move freely. And yesterday President Donald Trump announced on his social media that the U.S. and Iran are poised to hold fresh talks today in Qatar's capital, Doha. So we'll have to see what comes from that.

[A]

And what was the market reaction like?

[B]

Well, oil prices picked back up yesterday. They were obviously reacting to these weekend strikes, even if obviously the weekend ended in a better place than it had started. Brent crude rose from its four month low on Friday, closing yesterday at $73.15 a barrel. WTI was back up at $70.75 a barrel.

[A]

And equity markets?

[B]

Yeah, well, stocks rallied yesterday. This pause in hostilities clearly lifted sentiment. The s and P500 rose 1.18%. The Nasdaq Composite was up. The Dow jumped just shy of 0.6% and it closed at a record high above the 52,000 level. For the first time ever. The index was boosted by the appearance of Alphabet on its first day in the index that replaced Verizon. Alphabet saw nearly a 5% gain during the session yesterday.

[A]

And what's been the story in Asia overnight?

[B]

Yeah, largely continuing the trends that we've seen in the year and the quarter to date. Obviously we're coming up today's the end of the first half of the year. The KOSPI's up around 3% in the session, leading the gains in the region. It's on for a quarterly rise of 65%. Helen. And if it carries on this way, It'll be up 105% year to date. Japan's Nikkei are also notably higher now, more than 37% up on the quarter. The CSI and Shanghai Composite are higher this morning. But again the Hang Seng is lagging. It's down more than 1% this morning.

[A]

And we have to talk about the yen I think, don't we?

[B]

Yes, just quickly. The Japanese Yen has today weakened to its lowest level against the US dollar in 40 years. 162.41 per dol. The last time I looked. Japan's Finance Minister Satsuki Katayama said that the government is ready to take appropriate action against excessive currency moves.

[A]

Okay, so we'll be watching out for intervention in Japan then. And we've had some good news from China this morning. Right.

[B]

China's manufacturing activity expanded faster than expected in June with high tech production climbing on demand tied to the global artificial intelligence investment boom. While real estate development and consumer goods production remained under pressure. So the official Purchasing Managers Index edged up to 50.3 in June. That was from 50 in May. It beat economists forecasts. And of course now that it's above the 50 mark, it means it's returned to expansionary territory, which is good news. Meanwhile, the non manufacturing PMI also improved, signalling modest improvement in services activity despite overall subdued demand.

[A]

Now we also need to catch up on what happened closer to home in Europe yesterday.

[B]

Yes, a bit quieter. Shares closed flat yesterday. Gains in technology stocks were offset by declines in construction firms with the pan European Stoxx 600 index closed just 0.1% higher. So eking a gain the sell off in technology stocks last week which pushed the sector to its sharpest weekly fall since mid March, stabilised yesterday with a 1.2% gain. And it has to be said the European tech sector has benefited from the global AI rally. It's on track for its biggest quarterly gains on the Stoxx 600 and it's outperformed S&P 500 tech sector.

[A]

All right, and just before I let you go then, what should we be looking out for in the day ahead?

[B]

Well, we've got data releases from Europe, the flash June CPI prints in Germany, France and Italy will have German unemployment for June. And US releases include the Jolts report for May and the conference Board's consumer confidence for June. And just before I go looking at the screens futures pointing to a positive start in Europe and with a flat to positive start in the US trading session, let's see what the day brings.

[A]

Helen, very good, thank you very much Bernadette for the great roundup this morning.

[B]

Thanks for having me, Helen.

[A]

And now on to you. Carsten, Good morning. Firstly.

[C]

Good morning, Helen.

[A]

So here in Europe, it seems that the first heat wave of this summer is behind us now. As you and the Next Generation research team analyze the impact of long term structural trends on the economy, climate change change being one of them. I'd love to get your thoughts on what sort of impact you see these heat waves having.

[C]

So you're right, looks like heat wave number one has ended for now. More will follow either this summer, I guess, or in future summers, that's for sure. Beyond the ecological impact, an economic one is becoming increasingly visible. So losses caused by natural disasters, I.e. heat waves, floods and storms, remain on the rise all over the world. In Europe, they amounted to more than 30 billion per year on average between 2015 and 2024, compared to only 13 billion on average between 1980 and 2014. So quite a significant change.

[A]

Yeah, that's quite an uptick. How do you factor this into your future cities theme?

[C]

Well, I think both heat waves and then also floods in particular have become a threat for cities as their infrastructure is typically not sufficient to deal with this kind of weather with longer lasting torrential rain, for example. And to counter this threat, the sponge city concept has been developed. Its key features are to break up sealed spaces, to green the city and to store the rainwater in underground reservoirs instead of discharging it. The reservoirs are then used to water the widespread greenery and to cool the city. Ultimately, sponge cities combine ecological and economic benefits as they reduce the risk of disaster related damages while raising the attractiveness of the cities.

[A]

And what about the heat? I mean, walking around Zurich last week was almost unbearable. Unless you were very focused on getting to the lake.

[C]

Absolutely. So the way most of our cities are designed here in Europe, they tend to be disproportionately affected by heat waves. So sealed spaces dominate, greenery is often scarce, and the intensive use of cement and glass leads to the formation of so called heat islands. And then we have roads, squares, buildings, storing the heat during the day, discharging it during the night, which of course impacts the well being of the citizens. So from a health perspective, the lack of recovery during the night is in fact the most concerning element. And here in Europe we also have the problem that most of our buildings are quite old. So more than 60 years on average, sufficient insulation is often missing as our proper cooling systems. During the past few years, however, Europe has become one of the world's fastest growing markets for cooling systems, being heat pumps. That are basically running in reverse or actual air conditioning systems.

[A]

Europe and air conditioning. That's a story in itself, isn't it? In France? I know there's a high level political debate about this.

[C]

Yes, indeed. So Europe has never been very fond of air conditioners simply because there was no need given our mild climate. But this is changing as the need is changing. And very importantly, I think we don't see air conditioners anymore as the climate killers they once were, as they are increasingly operating on solar power and also using more environmentally friendly coolants. In fact, I would say that negative power prices on sunny days are a signal by the power market that more air conditioners could be used or should be used, in fact.

[A]

Okay, that's an interesting thought.

[C]

Well, I think it's a win win situation. But there is still a challenge in the evening to be very honest here, when the heat discharges from roads and buildings but the sun doesn't shine anymore. So ACs of course keep on running. And we have a bit of an issue there with the power market as evidenced by spiking prices in the evening during the past few days. But of course the solution to that is batteries, which are a key growth story of the ongoing energy transition.

[A]

What does all of this mean from an investment perspective then?

[C]

So from an investment point of view, we reiterate our positive view on the buildings and infrastructure segment of the future cities theme. The structural outlook for building efficiency and technology companies remains very strong, with the cyclical outlook being impacted by high interest rates and muted construction activity. That said, from our point of view, this segment should have left the worst behind. And the same applies to companies that are more exposed to future proofing our cities, such as consultancy companies, construction companies, or equipment rental companies, which are then more in charge of changing the cities to a sponge city. Plus, we're also positive on the clean energy theme.

[A]

Wonderful. Thanks a lot Carsten. Great to have you on the show again today.

[C]

Thanks for having me. Bye bye.

[A]

So that's it for today. Thank you again to Bernadette and Carsten and to you, our listeners, for tuning in. I hope you enjoyed the show. If you did, then make sure you subscribe if you haven't already. And please join us again tomorrow when Bernadette will be back, but as your host and she'll be joined by more of our colleagues to talk about what is moving markets. So have a great day everyone and bye for now. The information and opinions expressed in this podcast constitute marketing material and are not the result of independent financial or investment research. Please refer to www.juliusbeer.com forward/legal podcasts for further other important legal information.