Markets Breathe a Sigh of Relief as Iran Sanctions Plans Unfold

Global markets regained calm on Tuesday after investors shrugged off US plans to expand sanctions against Iran. The US Treasury Department's warning on Monday had triggered a modest overnight pullback in oil prices and government bond yields, but it stopped short of imposing penalties.

The markets took comfort in the softer-than-feared announcement, with European shares rising 0.4% and Wall Street futures pointing to higher restarts later this week. The dollar inched up against the euro and Japanese yen, despite a breakdown in its traditional correlation with bond yields.

Michael Metcalfe, head of global macro strategy at State Street Global Markets, said the jump in yields and weakness in the dollar over the last month was a sign that a 'negative bias' towards the greenback could be returning. He noted concern about the US fiscal situation and its impact on the dollar.

Meanwhile, the global cryptocurrency market continued to gain traction, with Bitcoin crossing the $80,000 level for the first time since mid-May. The tech sector was holding its breath for Nvidia's results on Wednesday, with investors aware of the chipmaker's lofty expectations.