* White House eyes all options to cut oil prices amid war

* Dollar lifted by expected boost to US terms of trade

* Gold and silver slide on stronger dollar and delayed Fed rate cut bets

* US stocks fall as WTI hits $82, though tech outperforms other sectors

FX: USD bounced off the downward trendline from the late November top as oil prices picked up again. We talk in more detail about the dollar below. There was much headline havoc during the day with positive and then not so positive reports including commentary that Iran was prepared to abandon its nuclear program and later on, attacks on Bahrain energy facilities. Reuters also reported that China is in talks with Iran to allow safe oil and gas passage through the Hormuz.

EUR slid again though closed off its lows, with the 200-day SMA at 1.1668 sitting above. Growth prospects are under pressure and being questioned which means the zone and the single currency will stay offered as long as the energy crisis goes on. The ECB’s de Guindos suggested that the bank could change policy stance if inflation expectations change as a result of the Middle East conflict.

GBP fared better than most of the majors. Markets have priced out Bank of England rate cuts through this week, which has helped sterling, especially against the euro. That currency pair is now holding onto the 50-day SMA at 0.8692.

JPY initially benefited from Bloomberg reports that officials see little chance of a rate hike in March but will not rule one out in April. Dollar weakness also saw the major dip to 156.44. But demand for the greenback was seen through the day, even if the yen did outperform its peers with its haven status coming to the fore.

US stocks: The S&P 500 lost 0.56% to close at 6,831, the Nasdaq was 0.29% lower at 25,020 and the Dow Jones settled lower by 1.61% at 47,955. The S&P 500 closed on its 100-day SMA at 6,836 with the 50-day at 6,905. The Nasdaq remains below both those momentum indicators while the Dow Jones’ recent underperformance has seen it dip below the 100-day SMA at 48,178. All sectors were red apart Energy, tech and Consumer Discretionary. Cyclically sensitive industrials and materials led the losers. Broadcom closed up 4.8% after its strong next quarter outlook with $100bn of AI chip revenue forecast grabbing the headlines. The software sector bounced for a fourth day in a row with Salesforce hitting early February levels.  Caterpillar fell 3.5% as investors priced in the risk of supply chain disruptions and margin compression.

Asian stocks: Futures are red. APAC stocks bounced back on tech strength Stateside. The ASX 200 offset losses in commodity sectors with tech buying. The Nikkei 225 surged initially but closed off its best levels. The Hang Seng and Shanghai Comp followed their peers higher, with focus on the GDP target. The slowest growth target on record since 1991 at 4.5%-5% was set with more emphasis on quality.

Gold was mixed as the long-term support drivers like central bank buying are being trumped by rising inflation concerns which could mean rates are higher for longer. That makes non-yielding bullion less attractive. The rising dollar also didn’t help bugs.

Day Ahead – US Non-Farm Payrolls and Retail Sales

Consensus expects 60k jobs to be added in February, below the prior 130k. The unemployment rate is predicted to remain at 4.3% and wage growth is seen one-tenth lower at 0.3%. Cold weather from late January could mean a lower headline print, but this wouldn’t necessarily signal any major weakening in underlying hiring conditions. Other recent labour market gauges have steadied though the lack of breadth of job creation is concerning some economists. Before the Middle East conflict, Fed officials had already appeared to be shifting their focus to inflation, with Chair Powell seeing signs of stabilisation in labour markets.

For retail sales, the headline is forecast to fall 0.3% versus the prior flat print. Consumers typically pull back after the holiday season plus colder weather likely further weighed on activity. The control group figure was most probably driven by clearance sales after the festive season.

Regarding monetary policy, after cutting rates by 75bps over the final three FOMC meetings of 2025, officials signalled in January that it saw little need for additional near-term action given that inflation remained above target and, crucially in its view, the downside risks to the jobs market had receded. Price pressures will likely become increasingly important if higher energy prices are sustained, though that could then pressure growth and jobs.

Chart of the Day – Dollar holds above support

The last few days have been dominated by the haven qualities of the dollar, which has benefitted from its energy independence. This week has also seen strong US data which will be tested by today’s jobs report. Fed rate cuts bets have been reined in, which has benefitted USD as money markets now see only a 50/50 chance of a reduction in July. There was an 84% probability of that one month ago.

Going forward, an elongated conflict would extend the shock and be dollar bullish. More settled energy markets, with a very rough consensus being by the end of the month, could mean the buck retraces some of its recent gains. We’ve highlighted the downward trendline previously from the November high and touching the January peaks. Just below is a major Fib level of that November to January move at 98.55, which is where the 100-day SMA resides too. This week’s high sits at 99.68, just above the January top at 99.48. The November high is at 100.39.