U.S & Iran Conflict – Sunday, June 22, 2025

As we begin this letter, it’s important to clarify the lens through which we approach this communication.

We do not take political positions or advocate for any government action or policy. Our role is not to interpret world events through a political lens, but rather to evaluate their potential impact on capital markets and client portfolios. We recognize that geopolitical developments—especially military actions—can be deeply polarizing and emotionally charged. Our responsibility as fiduciaries is to remain objective, disciplined, and focused on prudent investment management, regardless of the prevailing political environment. Our commentary is intended solely to inform investors about potential market implications and is not a reflection of any political endorsement or viewpoint.

Before we address the market implications of recent events, we want to take a moment to acknowledge the people of Iran. Our hearts are with the innocent families—mothers, fathers, children—who are not responsible for the actions of their government, yet who so often bear the burden of conflict. Like people everywhere, they desire peace, stability, and the freedom to build a better life for themselves and future generations. We pray that this moment, though painful and fraught, may ultimately lead to greater safety, openness, and opportunity for the Iranian people. No strike, no matter how precise, comes without human cost, and we recognize the complexity and gravity of this situation. Our hope is not for destruction, but for a future where diplomacy, security, and human dignity prevail.

As we assess the events of Saturday, we hold hope that markets will interpret this decisive action as a step toward greater global stability. While geopolitical conflict inevitably brings uncertainty, it can also remove longer-term threats that markets have struggled to price. In this case, the targeted nature of the strikes—focused on nuclear infrastructure, not civilians—may be seen by investors as a move that reduces the risk of nuclear proliferation and broader regional destabilization. As renowned investor Steve Eisman remarked, the operation is “potentially extremely positive” for markets, precisely because it may avert a cascading arms race in the Middle East. Still, as with all such moments, there are two sides to the coin: markets must balance the potential for escalation against the removal of a major global risk. In the coming days, investor sentiment will likely reflect this tension—but there is a very real possibility that clarity and strength in leadership will restore confidence rather than diminish it.

Before Saturday’s events, market sentiment appears to reflect this logic: after an initial drop, equities stabilized as investors began pricing in the benefits of reducing nuclear proliferation. At the same time, multiple polls—such as a CNN poll reporting 79% of Americans oppose Iran developing a nuclear weapon (Source) —reveal overwhelming bipartisan concern. Economist/YouGov polling also shows that while many prefer diplomacy, a significant majority remain united in opposing a nuclear-armed Iran (Source). Had Iran succeeded, regional neighbors—even those currently silent—would likely pursue similar capabilities, escalating instability.

Online discourse on X and across news outlets echoes this sentiment: while political divisions persist, there’s broad acknowledgement that stopping Iran’s nuclear progress could enhance strategic stability—and that the markets might, at least in the near term, view this as a constructive development.

The consensus on the U.S. bombing of Iran’s nuclear facilities, based on available information, is mixed and highly polarized, reflecting both strategic and economic dimensions. The strikes, which targeted key sites like Fordo, Natanz, and Isfahan, are seen as a significant escalation in the Israel-Iran conflict, with the U.S. directly intervening to curb Iran’s nuclear ambitions. Based on Social Medial and generally available information found on the internet, below is a breakdown of the consensus and market implications as of Saturday June 21^st, 2025:

Consensus

1. Strategic and Political Perspectives:
   • Supportive Views: Some political figures, particularly those aligned with the Trump administration and Israeli leadership, view the strikes as a decisive move to prevent Iran from acquiring nuclear weapons. Israeli Prime Minister Benjamin Netanyahu praised the action, calling it a historic blow to Iran’s nuclear program. Former Vice President Mike Pence and Senate Majority Leader John Thune also commended the strikes, emphasizing that they enhance security for the U.S., Israel, and allies by neutralizing a nuclear threat.

Critical Views: Others, including the United Nations Secretary-General António Guterres, expressed alarm, warning of a “dangerous escalation” risking a broader regional conflict. The International Atomic Energy Agency (IAEA) labeled the attacks “deeply concerning” due to potential radiological risks, though no widespread contamination has been reported. Critics argue that the strikes could provoke Iranian retaliation, targeting U.S. troops or regional allies, and may close diplomatic avenues for nuclear negotiations.

Skeptical/Analytical Perspectives: Analysts note that while the strikes damaged Iran’s nuclear infrastructure, they did not eliminate its nuclear knowledge or ambitions. The Fordo facility, though heavily targeted, may still be partially operational, and Iran could rebuild within months. Some experts question the long-term efficacy, suggesting that the attacks might strengthen Iran’s resolve to pursue a nuclear deterrent. There is also debate over whether the strikes align with Trump’s “America First” stance, given his prior promises to avoid Middle East conflicts.

Public and Expert Sentiment:

1. Public sentiment, as reflected in posts on X, is divided. Some see the strikes as a necessary response to Iran’s nuclear threat, while others fear they could trigger a wider war, with oil price spikes and economic fallout.

Experts highlight the technical challenges of destroying facilities like Fordo, which is buried deep underground, and the risks of escalation if Iran retaliates against U.S. bases or regional oil infrastructure. The strikes are seen as a gamble that could either set back Iran’s nuclear program for years or ignite a protracted conflict.

Market Implications

The U.S. strikes have already caused immediate market turbulence, with potential for further volatility depending on Iran’s response and the conflict’s trajectory. Key impacts include:

• Oil Markets:
  • Immediate Reaction: Oil prices surged following initial Israeli strikes on Iran, with West Texas Intermediate (WTI) jumping past $80 per barrel. The U.S. strikes may amplifie this, as Iran’s role as a major oil producer (OPEC’s third-largest) raises fears of supply disruptions.
  • Potential Scenarios: If Iran retaliates by targeting oil facilities in the Gulf or blockading the Strait of Hormuz (through which 20% of global oil flows), prices could spike further, potentially reaching $90+ per barrel. However, some analysts suggest a downside skew, with prices possibly dropping to $50 if the conflict de-escalates or global demand weakens.

Long-Term Outlook: Continued instability could keep oil prices elevated, impacting inflation and energy costs globally. However, Iran’s weakened military and air defenses may limit its ability to disrupt oil flows significantly.

Stock Markets:

• Short-Term Impact: U.S. stock futures dropped 1.5% when Israel first struck Iran, reflecting fears of a broader conflict. The U.S. strikes likely deepened this unease, as investors moved toward safe-haven assets. Futures open on Sunday, and US markets on Monday, so we can only speculate until then.

Safe-Haven Assets:

• Gold and Dollar: Gold rallied to near-record highs, and the U.S. dollar strengthened as investors sought safety amid the crisis. This trend is likely to persist if the conflict escalates further.

Bonds: Treasury yields may face upward pressure as inflation fears grow, driven by potential oil price spikes. However, the flip side is yields drop if there is flight to quality.

• Global Economic Risks:
  • A prolonged conflict could exacerbate inflationary pressures, particularly in energy-importing nations, and disrupt global supply chains.

If Iran targets Gulf oil facilities, the resulting price shock could tip some economies into recession, especially those already grappling with high inflation.

Caveats and Uncertainties

• Iran’s Response: Iran has promised retaliation but has so far refrained from direct attacks on U.S. targets. Its weakened military and leadership losses may limit its capacity for significant counterstrikes, but asymmetric attacks (e.g., via proxies or cyberattacks) remain a risk.

Damage Assessment: The extent of damage to Iran’s nuclear facilities is unclear. Trump claimed the sites were “completely obliterated,” but Iranian officials and the IAEA suggest some infrastructure may remain intact.

Diplomatic Fallout: The strikes have dimmed prospects for reviving the Iran nuclear deal (JCPOA), potentially hardening Iran’s stance and complicating future negotiations.

Market Volatility: Markets are highly sensitive to new developments. Any sign of de-escalation (e.g., diplomatic talks) could reverse some losses, while further escalation would amplify volatility.

Key Highlights from President Trump’s Address

• “Spectacular military success”: Trump described the operation as a “spectacular military success,” asserting that “Iran’s key nuclear enrichment facilities have been completely and totally obliterated” (Source)
• Clear ultimatum: He stated Iran now faces a stark choice: “either peace or tragedy.” He warned that if Iran does not pursue peace, the U.S. “will go after those other targets with precision, speed and skill” (Source.)
• Limited scope, no regime change: Trump emphasized that the strikes focused exclusively on nuclear sites—not civilians—and underscored that there is no current American objective of regime change (Source).
• Safe return of forces: He noted that all U.S. aircraft “are now outside of Iran airspace,” confirming the mission’s tactical precision and successful execution (Source).
• Acknowledgment to Israel: Trump explicitly thanked Prime Minister Netanyahu, saying Israel “has done what no other country on earth could do,” and called the operation a defining moment for global security (source).

Conclusion

The U.S. bombing of Iran’s nuclear facilities is broadly seen as a high-stakes move with significant strategic and economic consequences. While some view it as a necessary step to curb Iran’s nuclear threat, others warn of escalation risks and limited long-term impact on Iran’s nuclear ambitions. For markets, the immediate effect has been a spike in oil prices, a dip in equities, and a rush to safe-haven assets. The trajectory depends heavily on Iran’s response and whether the conflict remains contained. Investors should brace for volatility, with oil and energy markets particularly exposed to further disruptions.

What Should Investors Do?

In light of these developments, investors should remain focused on long-term objectives while preparing for short-term volatility. This is not the moment to react emotionally or abandon a carefully constructed portfolio. Rather, it is a time to reaffirm core principles: diversification, discipline, and risk awareness. While the headlines are unsettling, many of the risks now surfacing were already embedded in markets—geopolitical tension, inflation sensitivity, and commodity disruptions. What has changed is the timeline. The situation may continue to evolve rapidly, but history has shown that markets often recover as clarity emerges. We recommend reviewing your risk tolerance and asset allocation with your advisor and making adjustments only if your personal circumstances or long-term goals have changed. In uncertain times, calm and conviction remain the investor’s greatest assets.

Our investment team will continue to monitor developments closely and provide timely updates to support your decision-making and thank you for your time and attention—and for the continued opportunity to serve you with diligence, integrity, and care.

Your SPG Team

Important Disclosures:

The information provided here is for educational and informational purposes only and does not constitute financial, investment, tax, or legal advice. Views expressed are those of the writer as of June 21, 2025 and may change without notice. Viewers are encouraged to consult with a qualified professional before making any financial decisions. All investments involve risk, including loss of principal. Past performance is not a guarantee of future results. Examples are illustrative and not recommendations to buy or sell any security. SPG or its clients may hold positions in securities or sectors mentioned. Third‑party trademarks and media references remain the property of their respective owners and do not imply endorsement.

Any forecasts or hypothetical scenarios presented are based on assumptions as of the recording date and are not guarantees of future outcomes. Results may vary significantly and are subject to change without notice.

All investing comes with risk, including risk of loss. Past performance does not guarantee future results. Predicted performance of the stock mentioned in this interview is the opinion of the speaker only as of the date of recording, is based on current events, commercial, and market activities, and is subject to change at any time, without notice. There can be no guarantee or assurance that the stock mentioned in this will perform as predicted. Results cannot be guaranteed and there is always risk with any stock investment. The contents of this have not been tailored to any viewer’s circumstances and no portion of this should be considered as investment advice. Viewers should seek guidance from the investment professional of their choosing to further analyze the topics discussed herein.

All rights reserved. No part of this publication may be reproduced, distributed or transmitted in any form or by any means, including recording or other electronic or mechanical methods without the prior written permission of the publisher, except in the case of brief quotations embodied in reviews and certain other noncommercial uses permitted by copyright laws.