Key Takeaways
- The US Dollar Index (DXY) held steady near 101.00 as safe-haven demand surged following a tenth consecutive day of US strikes against Iranian targets.
- Taiwan's TAIEX index staged a massive 1,000-point intraday recovery, reclaiming the 43,000 mark led by a 2.58% jump in Taiwan Semiconductor Manufacturing Co. (TSMC).
- Middle East tensions have driven oil prices higher, pushing the probability of a September Federal Reserve rate hike to 55% as inflation concerns resurface.
- Alexander's Inc (ALX) received a price target boost to $212 from Piper Sandler, following the successful closure of a non-core asset sale and a major lease agreement with Target (TGT).
US Dollar Strengthens on Safe-Haven Flows
The US Dollar Index (DXY) remained in positive territory on Tuesday, trading near the 101.00 level during the Asian session. The Greenback's resilience is largely attributed to escalating hostilities between the United States and Iran, which have entered their tenth day of direct military exchanges. Market participants are increasingly seeking the safety of the dollar as Tehran continues to launch retaliatory strikes against regional neighbors, further destabilizing the Middle East.
Geopolitical friction intensified after President Donald Trump warned that Iran would be held directly accountable for the deaths of three US service members. Additionally, Iran-backed Houthi militants announced a maritime embargo against Saudi Arabia, threatening critical energy shipments through the Red Sea. These developments have kept US Treasury yields elevated, with the 10-year yield advancing toward 4.60% as energy-driven inflation risks persist.
Taiwan Stocks Mount Powerful Counterattack
Following a period of intense volatility, Taiwan’s benchmark TAIEX index surged over 1,000 points intraday on Tuesday to reach a high of 43,487. This rally effectively reversed recent bearish sentiment and allowed the index to reclaim the psychologically important 43,000 threshold. The recovery was spearheaded by Taiwan Semiconductor Manufacturing Co. (TSMC), which jumped NT$60 to NT$2,380 after the company upwardly revised its capital expenditure to $64 billion to meet robust AI demand.
Other major technology players also saw significant gains, with MediaTek (2454.TW) surging over 4% and Delta Electronics (2308.TW) spiking 5%. Analysts suggest that the rapid recovery of heavyweight tech stocks demonstrates strong market confidence in AI fundamentals, despite the ongoing uncertainty in the Middle East. However, institutional investors remain cautious, noting that high volatility is likely to persist as major tech earnings reports are due later this week.
US Proposes New Framework for Hezbollah Disarmament
In a major diplomatic shift, the United States has reportedly put "once-unthinkable" ideas on the table to achieve the disarmament of Hezbollah in Lebanon. Lebanese President Joseph Aoun is scheduled to visit the White House this week to present a formal plan to the Trump administration aimed at bringing all weapons under state control. The proposal comes as Hezbollah faces significant military degradation following its confrontation with Israel and the loss of its strategic partnership in Syria.
The US State Department has signaled that "words won't be enough," emphasizing that the disarmament of the Iran-backed group is essential for Lebanon’s economic recovery and the receipt of $1.1 billion in promised international aid. The weakening of the Iranian regime at home and abroad has created a narrow window for Washington to secure concessions that were previously considered non-negotiable.
Piper Sandler Bullish on Alexander's Inc
Real Estate Investment Trust Alexander's Inc (ALX) is seeing renewed analyst interest, with Piper Sandler boosting its price target to $212. The upgrade follows the company's successful efforts to strengthen its balance sheet, including the sale of a non-core property and securing a 15-year lease with Target (TGT) at its Queens shopping center. This lease brings the 600,000 sq. ft. Rego Park facility to nearly 99% occupancy.
While the stock has gained over 14% in the past 90 days, some market analysts at Simply Wall St caution that its current Price-to-Earnings (P/E) ratio of 69x is significantly higher than the industry average of 27.1x. Despite the premium valuation, the company’s steady free cash flow and strategic asset management continue to attract positive sentiment from small-cap fund managers.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.