No deal

The negotiations in Islamabad concluded after 21 hours with no agreement between the parties. The U.S. delegation, led by Vice President JD Vance will be returning to the U.S. without a deal on Hormuz, nuclear proliferation or conflicts through Iran armed proxy groups. No clear path forward has been stablished, which means we can see attacks again. Not clear if the ceasefire will stand. Since negotiations took place over a weekend, the only market reference we have is crypto, and as you can see in the chart below, it’s not good. If that wasn’t enough, additional tensions are arising between Israel and Turkey, as Prime Minister Benjamin Netanyahu publicly criticized Turkish President Erdoğan, accusing him of “accommodating Iran’s terror regime and its proxies” and “massacring his own Kurdish citizens.” This came in response to Erdoğan’s comments on the fragile US-Iran ceasefire and broader regional issues. As of today, it’s difficult to see a path to de escalation of the conflict, even though expectations of a deal were low as positions are too far apart. The winner in these negotiations is Pakistan, as it is perceived as a great intermediary in the conflict and has position itself brilliantly in the middle to ease tensions between both parties. More to come as the week starts. We should expect oil to go up, and equity markets to go down until more information and clarity is provided.

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