Equities Plunge on Fed Jitters; Oil Retreats as Risk Premium Fades

Ultima Markets Daily Market Insights – 24 June 2026

Macro Drivers: Fed Jitters and Fading Risk Premiums

Driven by increasing Federal Reserve rate hike expectations, the global equities market experienced a massive sell-off yesterday, highlighted by the tech-heavy Nasdaq plunging 2.2%. According to the latest data from the CME FedWatch Tool, the futures market is actively pricing in a September rate hike:

• Assigning a 50.6% probability to a 25-basis-point increase, and;
• A 19.6% chance for a 50-basis-point hike.

This hawkish repricing continues to exert heavy pressure on the broader equities market, particularly the rate-sensitive tech sector.

Meanwhile, the energy market is undergoing a significant recalibration. As a glimmer of hope emerges for easing tensions in the Middle East and peace talks show tangible progress, the geopolitical risk premium is being aggressively squeezed out of the energy sector. Both Brent and WTI crude oil are under severe downward pressure, with prices retreating sharply and rapidly approaching pre-conflict levels.

These two major macroeconomic storylines—monetary tightening and fading geopolitical risks—are expected to firmly dictate near-term market sentiment as traders brace for tomorrow’s highly anticipated US PCE inflation report.

US Indices – S&P500 Analysis

For the Nasdaq 100, the technical landscape remains consistent with the consolidation phase detailed in yesterday’s analysis, as tech stocks continue to bear the brunt of the rate-hike headwinds.

Meanwhile, over the S&P 500 Index, the broader index recently failed to form a higher high and has forcefully slipped back below the critical 7,500 mark. From a technical perspective, this price action suggests the index is setting up for a deeper corrective move.

SP500, H4 Chart | Ultima Markets MT5

Technically, the failure to form a higher high suggests that bullish momentum has eased. While the index is not in a definitive bear market yet, continuous pressure below 7,500 points to a loss of momentum.

This could trap the S&P 500 in a corrective move—either via a pressured consolidation or a short-term bearish market if the 7,350 support level breaks.

This cautiously bearish setup is heavily reinforced by the current macroeconomic environment, where rising yield expectations leave little room for equity multiples to expand.

Dollar Gains 101-Mark

Turning to the greenback, rising Fed hike expectations undoubtedly continue to bolster the dollar. The US Dollar Index recorded another day of gains, securely trading above the 101-mark. With the dollar index surging to a 15-month high, the broader bullish bias remains entirely unchanged.

USDX, H4 Chart | Ultima Markets MT5

For now, the narrative that “any dip is a buy” remains intact, keeping major dollar pairs such as EURUSD and GBPUSD biased to the downside.

Watch closely for tomorrow’s PCE inflation data, as this will be the ultimate key to determining whether the dollar can extend its gains on hawkish Fed expectations.

Crude Oil: Sliding to Pre-War Levels

Over in the energy sector, with the geopolitical risk premium rapidly evaporating, crude oil faces an imminent risk of breaking below its pre-war consolidation zones.

UKOUSD (Brent) Analysis

Brent crude is currently testing a crucial psychological and structural floor near the $77 – $80 per barrel level, which forms a vital support zone for Brent.

UKOUSD, Daily Chart | Ultima Markets MT5

A sustained break below the $80.00/barrel level could open the floodgates for further downside momentum, where it could easily trade back to pre-war levels.

Given the fading fundamental catalysts, the prevailing strategy remains to “sell the rally” on any short-term technical rebounds.

USOUSD (WTI) Analysis

Similarly, the technical battlefield for WTI lies strictly within the $75.00 – $77.00 support zone.

USOUSD, Daily Chart | Ultima Markets MT5

A structural breakdown below this critical area would validate a bearish continuation and firmly entrench WTI in downside territory.

Summary for Crude Oil: For both crude benchmarks, the geopolitical risk premium is completely squeezed out, opening the door for more downside moves. While prices are currently hovering near key support levels where we might expect some minor technical rebounds, the broader macro picture dictates that any bounce here should be treated as a sell-the-rally opportunity.

Market Summary

A powerful mix of aggressive monetary tightening expectations and unwinding geopolitical risks drove massive market volatility. As the CME FedWatch Tool shows heavy betting on a September Fed rate hike, global equities faced a severe tech-led liquidation that dragged the Nasdaq down 2.2% and propelled the US Dollar Index past the 101 mark to 15-month highs.

Simultaneously, diplomatic progress in US-Iran peace talks aggressively deflated the geopolitical risk premium in the energy sector, sending Brent and WTI crashing back toward pre-war levels.

Heading into tomorrow’s critical US PCE inflation report, the dominant market theme favors buying US dollar dips while using technical rebounds to sell rallies in both crude oil and major equity indices.

Disclaimer

Comments, news, research, analysis, price, and all information contained in the article only serve as general information for readers and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.