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Israel Signals Optimism for Cease-Fire Talks…….. Israel reportedly ready to strike Iran if attacked

  • Partial troop withdrawal may be signal to Hamas on deal
  • Far-right coalition partners express alarm and threats

  • Partial troop withdrawal may be signal to Hamas on deal
  • Far-right coalition partners express alarm and threats

 Senior Israeli officials said progress has been made in negotiations for a cease-fire in Gaza that would include the release of hostages and Palestinian prisoners. Hamas, designated a terrorist organization by the US and European Union, said on Monday there’d been no progress in the talks. 

Israel reportedly ready to strike Iran if attacked

Israel stands prepared to retaliate against Iran by targeting sites within the country if it is attacked as a response to the recent strike on the Iranian consulate in Damascus, the London-based Elaph News reported on Tuesday, citing a “Western security official.”

Furthermore, the media stated that Israel has been conducting air force exercises in recent days, focusing on preparing to strike Iranian nuclear facilities and other critical infrastructure.

While Syria and Iran hold Israel responsible for the strike that resulted in the deaths of seven officials from the Islamic Revolutionary Guard Corps (IRGC), Israel has not confirmed its involvement in the attack.

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WH: Waiting for Hamas’s response to proposal

White House National Security Communications Advisor John Kirby announced on Monday that a proposal for the hostage release with Israel has been presented to Hamas and that the parties involved are now waiting for the group’s response. Speaking to reporters, Kirby confirmed that Central Intelligence Agency (CIA) Director William Burns was a member of the US’s delegation on the negotiations in Cairo. Furthermore, he insisted that Washington found “no signs” Israel is planning an “imminent” and “major ground operation” in Rafah. Earlier in the day, Qatar, one of the mediators in the talks, expressed optimism about Israel and Hamas reaching a new deal.

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US says it is against Israel’s Rafah op

The United States Department of State’s spokesman Matthew Miller said on Monday that Washington was not briefed about Israel’s plan to launch a ground operation in the Gazan city of Rafah and voiced his country’s stance against it. “We have made clear to Israel that we think a full-scale military invasion of Rafah would have an enormously harmful effect on those civilians and that it would ultimately hurt Israel’s security,” Miller said at a press conference. “We have made clear to them that we think that there is a better way to achieve what is a legitimate goal, which is to degrade and dismantle and defeat the Hamas battalions that still remain in Rafah.” Miller’s comments came after Israeli Prime Minister Benjamin Netanyahu announced a date for the ground operation in Rafah has been determined.

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Gallant: Israel at ‘opportune moment’ for hostage deal

Israeli Defense Minister Yoav Gallant  emphasized on Monday that he sees Israel “at an opportune moment” to negotiate a hostage agreement with Hamas and “bring our captives back home.” During a speech addressed to new soldiers, Gallant stated that the recent conflict in Gaza has “enabled us to be flexible, to act freely and to make difficult decisions in order to bring back the abductees. I believe we are at an opportune moment, but there’s another side that must agree to it.” On the same matter, Israeli Foreign Minister Israel Katz told Army Radio that the parties “have reached a critical point in the negotiations. If it works out, then a large number of hostages will come home.”

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No progress made at Cairo ceasefire talks, says Hamas official……… Israel to reportedly know proposal feasibility by Tuesday

CAIRO (Reuters) – A Hamas official told Reuters on Monday that no progress was made at a new round of Gaza ceasefire talks in Cairo also attended by delegations from Israel, Qatar and the United States.

“There is no change in the position of the occupation and therefore, there is nothing new in the Cairo talks,” the Hamas official, who asked not to be named, told Reuters. “There is no progress yet,” he added.

Earlier on Monday, Egypt’s state-affiliated Al-Qahera News TV channel quoted a senior Egyptian source as saying progress had been made in the talks, after a deal was reached among participating delegations on issues under discussion.

Israel and Hamas sent teams to Egypt on Sunday after the arrival on Saturday of CIA Director William Burns, whose presence underlined U.S. pressure for a deal that would free hostages held in Gaza and ease the humanitarian crisis there. Israel and Hamas, at war in the Gaza Strip since October, have failed so far to resolve disagreements over their main demands. Hamas wants an end to Israel’s offensive and a full Israeli withdrawal from the shattered territory, while Israel wants a deal to free hostages from Gaza in exchange for a number of Palestinians in its jails without a commitment to end the war.

Israel to reportedly know proposal feasibility by Tuesday

The Israeli party involved in negotiations with Hamas for a ceasefire and hostage exchange will know the feasibility of progressing with the new proposal by Tuesday evening, Sky News Arabia reported on Monday. “Washington and Cairo put forward a new proposal that includes signals related to the return of Gaza residents to the northern Gaza Strip,” the media added. This aspect is one of the key points emphasized by Hamas in the agreement. In response to this development, Israeli Finance Minister Bezalel Smotrich urged Prime Minister Benjamin Netanyahu to convene an urgent expanded government meeting. NN:   Obviously talks are at a critical stage. The global  pressure is intense. I believe a deal is close.

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Oil Prices Fall as Israel Withdraws Some Troops From Gaza

Oil prices retreated at the start of the week on signs that there is a possibility of a ceasefire between Hamas and Israel .Benchmarks began the week shedding some $1 per barrel, which pushed Brent crude below $90 and West Texas Intermediate below $86, after Israel moved some troops out of Gaza during the weekend. “It appears the catalyst is Israel saying it has withdrawn all troops except one brigade from the Southern Gaza strip, likely in response to growing international pressure and to deescalate tensions after it killed senior Iranian commanders in Syria last week,” IG analyst Tony Sycamore told Reuters. The Iranian response to the Israeli strike on Tehran’s consulate in Damascus, however, is still a factor for prices, and a bullish one, at that, after President Ebrahim Raisi vowed there would be revenge. Fundamental factors are also very much still in play, with one Mizuho Bank analyst telling Bloomberg that geopolitical developments have only served to highlight the tight supply situation in oil markets.

“Oil’s upside volatility remains very much present, and that’s to a large part thanks to geopolitics amplifying supply shortfalls elsewhere,” Vishnu Varathan said.

The price decline also comes in anticipation of three closely watched reports about the state of the global oil market coming out this week. The Energy Information Administration’s Short-Term Energy Outlook is first, due out on Tuesday. Then comes OPEC’s latest Monthly Oil Market Report, scheduled for Thursday, and the International Energy Agency’s Oil Market Report a day later. The latter two reports will probably attract the most attention due to their growing divergence that led to vocal criticism of the IEA by senior OPEC figures. They accused the agency of betraying its original purpose and turning into a “cheerleader” for the energy transition as a group of U.S. Republican lawmakers called it.

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Israel, Hamas reportedly deny ceasefire talks ‘progress’

Israeli officials and Palestinian representatives refuted the earlier report by Al-Qahera News, which claimed “remarkable progress” in the ongoing ceasefire negotiations between the two parties in Cairo, as reported by local media on Monday. “We still don’t see a deal on the horizon … The distance [between the sides] is still great and there has been nothing dramatic so far,” Israeli news outlet Ynet reported, citing senior Israeli officials. Hezbollah-affiliated Al-Mayadeen news quoted a senior Palestinian official in Gaza expressing frustration with Israel’s “obstinance” and adds that “so far there is no progress.”

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Fed’s Bowman sees higher rate ‘risk’ in the future

United States Federal Reserve Governor Michelle Bowman stated Friday that she still sees several “upside risks” and “uncertainties” related to the inflation levels for what she considers it is still not the time “where it is appropriate to lower the policy rate.” “While it is not my baseline outlook, I continue to see the risk that at a future meeting we may need to increase the policy rate further should progress on inflation stall or even reverse […] Reducing our policy rate too soon or too quickly could result in a rebound in inflation, requiring further future policy rate increases to return inflation to 2 percent over the longer run,” she said during a speech in New York. She added that “the level of the federal funds rate consistent with low and stable inflation” may end up being higher than before the pandemic. NN: rates are going up. So is inflation.

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Iran Tells US to Step Aside as It Readies Response to Israel

Iran said it asked the US to “step aside” as the country prepares a response to a suspected Israeli attack on its consulate in Syria while Hezbollah, its main proxy in the Middle East, warned the Jewish state it’s prepared for war.In a written message to Washington, Iran “warned the US not to get dragged into Netanyahu’s trap,” Mohammad Jamshidi, the Iranian president’s deputy chief of staff for political affairs, wrote on X, referring to Israeli Prime Minister Benjamin Netanyahu. The US should “step aside so that you don’t get hit.”“In response, the US asked Iran not to hit American targets,” Jamshidi said.The US hasn’t commented on the alleged message Iran had sent. CNN reported that the US is on high alert and is preparing for a “significant” response from Iran against Israeli or American targets in the region. The network cited an unnamed US official. NBC, citing two unnamed US officials, said President Joe Biden’s administration is concerned any attack could be inside Israel, specifically against “military or intelligence targets, rather than civilians.” The Biden administration did take the unusual step of communicating directly to Iran that the US was unaware Monday’s strike in Damascus would happen, Bloomberg reported. That suggested the US was trying to prevent its own forces and bases in the Middle East being attacked. The Islamic Republic has said it will deliver a “slap” to Israel, its arch enemy. Still, it’s unclear when that would happen or whether Iran would try to attack Israel directly or through one of its proxy groups such as Hezbollah, based in Lebanon. The airstrike hit the Iranian consulate in Damascus, killing at least seven Iranians, including two generals. While Israel has repeatedly targeted Iran-linked assets in Syria over the past few months, this was the first time an attack struck an Iranian diplomatic building.Israel has been on alert since then, canceling home leave for combat troops, calling up reserves and bolstering air defenses. Its military scrambled navigational signals over Tel Aviv on Thursday to disrupt GPS-navigated drones or missiles that might be fired at the country. Hezbollah’s leader, Hassan Nasrallah, on Friday said a response from Iran is undoubtedly coming. But, he said, his group won’t “interfere in such decisions.” “And after that, how Israel will behave, the region would enter in a new phase,” Nasrallah said in a televised speech. Nasrallah, who lives in hiding, highlighted the coordinated work of Iran’s so-called resistance groups in the region.Hezbollah, the Middle East’s most powerful militia, said the group hasn’t used “its primary arsenal” in the daily skirmishes with Israel along the southern border of Lebanon since the start of the Israel-Hamas war on Oct. 7. Hezbollah is “completely prepared and ready” for any war with Israel, Nasrallah said. NN: Its a big b bet. I  believe Iran is NOT  ready for all out war.

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Extreme Market Swings Dominate as Hot Economy, Oil Feed Anxiety

A steady march higher in markets was snapped by a stretch of jarring volatility as traders gave hints there’s a limit to their appetite for hot economic data. While a Friday rally in equities spared cross-asset investors their worst week since 2022, it capped a series of extreme market moves. Stocks and bonds staged their worst synchronized drop of the year on Monday and Tuesday, while Thursday saw the biggest reversal of an S&P 500 rally since August. An exchange-traded fund tracking long-dated Treasuries suffered its worst week since October as 10-year yields reached the highest in more than four months. Rather than recession anxiety, the culprit was robust reports on job openings and factory output — as well as a surge in oil — that raised doubts the Federal Reserve has room to cut interest rates anytime soon. An emerging issue for bulls is the impact of markets themselves on the economy, according to Torsten Slok, the Apollo Global Management economist who has repeatedly warned that gains in asset prices are working against central bankers’ goals. “The tailwind from easing financial conditions is overwhelming and neutralizing the rate hikes from last year,” Slok, who in March predicted no rate cuts this year, said in a phone interview. “It’s not surprising that the economy is re-accelerating and, therefore, rates will have to stay higher.” The broad rally across assets that has added $13 trillion in financial wealth since October looked shakier this week as inflation angst resurfaced, with Brent crude climbing above $90 a barrel. Another solid jobs report Friday on the heels of an unexpected expansion in manufacturing triggered a hawkish repricing in bonds. Traders are now pushing back bets on when the Fed will start cutting rates to September, paring odds for June or July.The ICE BofA MOVE Index, which tracks expected turbulence in US bonds via options on interest-rate swaps, bounced from a two-year low to snap a six-week slide. Subtle shifts in investor behavior appeared in the stock market, marking a switch after traders spent months buying the dip and piling in to bullish options. On Thursday, when the S&P 500 wiped out a 0.8% gain to end the session more than 1% lower, the Cboe Volatility Index, a gauge of options cost known as VIX, jumped to its highest since November. “Clearly, the market is getting anxious about what the Fed is going to do,” said Raphael Thuin, head of capital market strategies at Tikehau Capital. “The Goldilocks market that investors are hoping for may not be a reality.”

In the eyes of contrarians who have watched asset gains spread to risky corners from cryptocurrencies to meme stocks, a sweeping retreat is overdue. Bolstered by optimism that the Fed will be able to bring inflation toward its 2% target without snuffing out growth, $176 billion of fresh money was poured into fixed income and equity ETFs in the first quarter, more than doubled from a year ago, data compiled by Bloomberg Intelligence show.

And Citigroup Inc.’s Levkovich Index — which tracks reams of data from retail sentiment to options trading and fund positioning — recently entered euphoria territory for the first time in more than two years.

Stretched sentiment in and of itself may not be reason enough for equity gains to reverse. But as the bull camp gets crowded, weak hands can be quickly vanquished. Hedge funds, for instance, stepped up bearish wagers against individual stocks, with short selling rising at the fastest pace in six months, according to data from Goldman Sachs Inc.’s prime brokerage unit.

Adding to trepidation is a chorus of policymakers including Fed Chair Jerome Powell signaling that they are in no rush to lower interest rates. Most notable was Minneapolis Fed President Neel Kashkari, who — though not a voter on monetary policy this year — still managed to raise eyebrows by saying interest-rate cuts may not be needed this year at all if progress on inflation stalls. Dallas Fed President Lorie Logan on Friday said it’s too soon to consider cutting interest rates, citing recent high inflation readings. “This is definitely a ‘good is bad’ environment,” said Michael O’Rourke, chief market strategist at JonesTrading. “Although Chairman Powell said that recent hot inflation and economic data do not ‘materially change the overall picture,’ there is some change. Several more hot data points are likely to tip that balance and push rate cut expectations further out.”