The Stable Genius Report

• A CBS News/YouGov poll asked about approval or disapproval of US strikes on Iran's nuclear facilities.
• 85% of Republicans approve of US strikes on Iran's nuclear facilities.
• 15% of Republicans disapprove of US strikes on Iran's nuclear facilities.
• 94% of MAGA Republicans approve of US strikes on Iran's nuclear facilities.
• 6% of MAGA Republicans disapprove of US strikes on Iran's nuclear facilities.
• The poll was conducted from June 22-24, 2025.

The post indicates high approval for potential US airstrikes on Iran, a major oil-producing nation in a critical geopolitical region. Actual military action would likely cause significant market volatility, specifically through potential disruptions to global oil supplies and heightened energy prices. This would translate into increased operating costs for businesses, potential inflationary pressures, and a broad risk-off sentiment in equity markets, putting downward pressure on the S&P 500 due to reduced corporate earnings expectations and increased uncertainty.

The post highlights strong public support among a significant political demographic for US military action against Iran's nuclear facilities. Such strikes would constitute a direct act of war, carrying extremely high potential for immediate and widespread conflict escalation in the Middle East, with global repercussions including potential retaliation from Iran or its allies, and possibly drawing in other regional or international powers. This scenario presents a critical and immediate threat to geopolitical stability.

• Commodities: Gold (XAU) is highly likely to rise as a safe-haven asset due to extreme geopolitical uncertainty and fear. Oil (WTI) prices are expected to surge significantly due to potential direct supply disruptions from Iran and the Strait of Hormuz. Silver and Copper may face downward pressure due to broader economic growth concerns. Short-Term Watchlist: XAU/USD price action, WTI futures, geopolitical headlines on Iran/Middle East. Medium-Term Focus: Global oil supply/demand dynamics, inflation trends, central bank responses.
• Currencies (Forex): The US Dollar Index (DXY) is highly likely to strengthen as a primary safe-haven currency during periods of extreme global risk. Pairs like EURUSD and GBPUSD would likely fall, while USDJPY might show mixed signals depending on whether Japan Yen also acts as a safe haven globally. USDCNH could rise as the Renminbi weakens amid global uncertainty. Short-Term Watchlist: Global risk sentiment, Treasury yield movements, central bank commentary. Medium-Term Focus: Divergence in monetary policy, global growth differentials, capital flight to quality.
• Global Equities: Major global indices (S&P 500, Nasdaq, STOXX 600, Nikkei 225, Hang Seng) are expected to experience significant declines due to the severe risk-off sentiment, increased geopolitical premium, and potential economic slowdown. Certain sectors, such as defense, might see some positive movement, while others, particularly those reliant on stable global supply chains or consumer spending, would face headwinds. Short-Term Watchlist: Equity futures performance, VIX spikes, sector-specific reactions (e.g., energy, defense). Medium-Term Focus: Corporate earnings revisions, macro-economic data, global capital flows, geopolitical risk premium.
• Fixed Income (Bonds): US 10Y and 2Y Treasury yields are highly likely to fall as investors seek safety in government bonds, leading to a flight to quality. This would cause bond prices to rise. Credit spreads, particularly for high-yield corporate bonds, would widen considerably due to increased perceived credit risk. The yield curve might flatten or invert further as short-term rates reflect immediate crisis while long-term rates price in potential recession. Short-Term Watchlist: UST 10Y yield levels, TED spread, corporate bond ETF flows. Medium-Term Focus: Federal Reserve's response to inflation/growth, sovereign debt concerns, fiscal policy implications.
• Volatility / Derivatives: The VIX (CBOE Volatility Index) is highly likely to spike dramatically, reflecting extreme market fear and uncertainty. Options markets would see increased demand for hedging instruments (puts), potentially leading to gamma squeezes and amplified market moves. Implied volatility across all asset classes would rise sharply. Short-Term Watchlist: VIX levels versus futures term structure, 0DTE options activity, SKEW index for tail risk. Medium-Term Focus: Volatility regime shifts, market liquidity conditions, systemic tail risk events.
• Crypto / Digital Assets: Bitcoin (BTC) and other major cryptocurrencies might initially face selling pressure as investors de-risk across all asset classes, behaving like risk-on assets. However, if the crisis persists and traditional financial systems show stress, Bitcoin could eventually find some support as an alternative 'digital gold' hedge against systemic risk or currency devaluation. Correlation with tech stocks would be a key factor. Short-Term Watchlist: BTC/USD price action, stablecoin flows, exchange funding rates. Medium-Term Focus: Regulatory developments, macro liquidity backdrop, correlation with traditional safe havens.
• Cross-Asset Correlations and Systemic Risk: Expect a significant breakdown in traditional cross-asset correlations, with both equities and bonds potentially selling off simultaneously if liquidity becomes a major concern. Signs of systemic stress, such as widening interbank lending spreads, increased margin calls, and stress in funding markets, would be critical to monitor. Short-Term Watchlist: MOVE index, high-yield bond ETFs, gold/USD co-movement. Medium-Term Focus: Central bank intervention strategies, financial system resilience, global liquidity conditions.
• Retail Sentiment / Market Psychology: The prospect of military action would likely induce significant fear and panic among retail investors, leading to broad selling across various asset classes. There would be a strong shift towards risk aversion and a preference for cash or perceived safe assets. This type of event is less likely to trigger speculative 'meme stock' rallies and more likely to result in a general withdrawal from risky assets. Short-Term Watchlist: Social media sentiment, Reddit/X trends for panic or flight-to-safety discussions. Medium-Term Focus: Overall investor confidence, long-term impact on risk appetite, potential for sustained market conservatism.