WTI crashed to $70.34. Brent fell to $73.74 — the lowest since before the first American bomb fell on Iran in February. Oil dropped nearly 4% in a single session. Gold crashed through $4,000. The 10-year yield fell below 4.5%. And the S&P 500, after rallying 0.7% at midday and fading into the close, ended basically flat — down a tenth of a percent. The Dow gained 182 points. The Nasdaq slipped 0.43%. The chips still couldn't bounce. Micron reports tonight. PCE comes out tomorrow. But the number that matters most today isn't in an earnings report or a government release. It's on the oil chart. If oil stays at $70, every inflation reading from July forward falls — and the nine Fed dots that want to hike lose their reason to exist.
The S&P 500 dipped 0.10% to 7,358.22. The Nasdaq edged down 0.43% to 25,476.64. The Dow added 182 points. The market rallied midday — the S&P and Nasdaq were both up about 0.7% — then faded into the close as chips gave back their gains and traders sat on their hands ahead of Micron's report tonight. The semiconductor ETF finished flat for the day, meaning the chip selloff paused but didn't reverse.
| The Numbers I Circled |
At the close, June 24 · Day change |
|
| WTI Crude |
$70.34 |
−3.92% |
| Brent Crude |
$73.74 |
−4.33% |
| S&P 500 |
7,358.22 |
−0.10% |
| S&P 500 Sectors |
Day change |
|
| Real Estate |
|
+1.5% |
| Utilities |
|
+1.2% |
| Health Care |
|
+1.0% |
| Consumer Staples |
|
+0.8% |
| Financials |
|
+0.6% |
| Industrials |
|
+0.4% |
| Materials |
|
−0.2% |
| Information Technology |
|
−0.4% |
| Consumer Discretionary |
|
−0.6% |
| Communication Services |
|
−0.8% |
| Energy |
|
−3.0% |
| Biggest Losers |
Day change |
|
| Notable Gainers |
Day change |
|
|
|
|
|
|
|
|
|
|
|
|
| Builders FirstSource BLDR |
+9.7% |
|
|
|
|
Oil was the story. WTI fell 3.92% to $70.34 — a level it hasn't touched since early March, when the Strait was freshly closed and the war premium was still building. Brent dropped 4.33% to $73.74, its lowest since before the February airstrikes. Trump said Wednesday that Iran agreed to charge no tolls, insurance costs, or fees on ships passing through the Strait. Treasury Secretary Bessent said on CNBC he's confident the economy can hit 3% growth this year now that the war is ending. Oil has fallen 26% from its $95 April peak. The war premium is gone.
Gold cracked too. Spot gold broke below $4,000 for the first time in months — down over $100 in a single session. It's now 25% below its January peak near $5,600. When oil falls, inflation expectations fall. When inflation expectations fall, the demand for gold as a hedge drops. Gold and oil are saying the same thing: the war trade is over.
Homebuilders had their best day of the year. KB Home jumped 17% after beating revenue estimates. The homebuilder ETF rallied 7%. When bond yields fall, mortgage rates follow — and the stocks that build houses start moving. The 10-year yield dropping below 4.5% is the first crack in the rate wall that has kept housing frozen since last fall. Alphabet will join the Dow Jones Industrial Average on Monday, replacing a stock S&P Global hasn't named yet.
What The Market Is Pricing In
Oil hit $70. That's not just a number on a chart. It's the number that rewrites the Fed's math.
Here's the chain. The war pushed oil from $70 to $95 between February and April. That $25 increase added roughly 0.8 to 1.0 percentage points to CPI over the following three months. That's what pushed headline CPI from 3.2% in January to 4.2% in May. That's what gave nine of eighteen Fed officials a reason to want hikes. That's what moved the dot plot from 3.4% to 3.8%. Every link in the hawkish chain started with oil above $90.
Oil is now at $70. The war premium is being unwound barrel by barrel. Iranian oil is hitting the market under Bessent's 60-day license. Ships are moving through the Strait. Trump says no tolls. And the price is back to where it was before the first bomb fell. If it stays here — and with OPEC production elevated and Iranian barrels flooding back in, there's no reason for it to bounce — then the June and July CPI readings will drop. Fast. A sustained move from $95 to $70 could take a full percentage point off headline inflation by late summer. CPI below 3.5% by August. Below 3% by October.
Oil crashed to $70 — its lowest since before the war — and if it stays here, the inflation data that produced the nine hawkish dots last week is already obsolete, and the Fed will be staring at a 3% CPI by fall with a dot plot that says 3.8%. The dots don't update until September. The data updates every month. And the data is about to move faster than the dots. That's the trade. Tomorrow's PCE reading for May will still show the war's damage — oil was still above $85 for most of May. It'll be ugly. But the market isn't trading May's backward-looking number. It's trading July and August's forward-looking number. And at $70 oil, those numbers look very different from what the Fed projected last week.
I saw this setup in early 2015. Oil crashed from $100 to $45. Everyone panicked about energy earnings. But lower oil flowed through to lower gas, lower shipping costs, lower food prices. CPI fell. The Fed held. The S&P rallied 15% over the following year. The transmission mechanism is always the same: oil down, inflation down, rates hold, stocks reprice higher. The question is timing. Today the market sat flat while oil fell 4% — that's a market waiting for confirmation, not a market in trouble. Micron tonight and PCE tomorrow are the next two data points. Oil already gave you the answer.
Three things I'm watching in the next 24 hours:
01 — Micron earnings tonight after the close
Micron is down 25% from its all-time high in three sessions. Analysts expect $20.83 per share on $35.75 billion in revenue. The key isn't the quarter — it's the guide. If Micron guides above consensus and says data-center demand for AI memory is accelerating, the chip selloff was just a crowded-trade shakeout and the sector finds a floor. If Micron guides flat or warns about HBM4 production delays — echoing the SK Hynix reports from this week — the semiconductor ETF's 12% slide from its peak is just getting started. Tonight's call sets the tone for the entire AI trade going into July earnings season.
02 — May PCE inflation Thursday June 25 at 8:30 AM
The Fed's preferred measure. Consensus: 3.5-3.6% headline, 3.2-3.3% core. The May reading still captures the war's oil spike — this is backward-looking data. The market knows it. What matters is whether core PCE comes in below or above the Fed's 3.3% projection. Below 3.3%: the dots look too hawkish, the 2-year yield eases, and the market rallies. Above 3.3%: the hike trade is alive and the chip selloff extends. The Fed also releases Q1 GDP final estimate and May durable goods orders on the same day.
03 — Oil at $70: floor or door?
WTI at $70 is where oil was before the war. If it holds here and bounces, the peace dividend is priced and inflation stabilizes at current levels — high enough to keep the hawks uncomfortable. If oil breaks through $70 and heads toward $65, the inflation story flips entirely. Iranian crude is hitting the market freely. OPEC is producing at high levels. The Strait is reopening. The only thing that sends oil back up is a breakdown in the Iran deal — and today Trump said the Strait will be toll-free. The direction of oil over the next two weeks tells you more about the second half of 2026 than any Fed speech.
Oil is at $70. Micron reports in an hour. PCE comes out at 8:30 tomorrow. The market held flat through a 4% oil crash and a chip selloff that won't quit — and now it's waiting. Tomorrow we find out if the data confirms what the oil price is already screaming: the war's inflation is over.
That's it for today. See you tomorrow after the close.
— Tom Hartley
Today In Perspective · Published daily, Monday–Friday, after the close
This newsletter is for informational purposes only and does not constitute investment advice. The author is not a registered investment advisor. Past performance does not guarantee future results. Consult a qualified financial professional before making investment decisions.
