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Top Overnight News

An impending wave of oil that’s been trapped inside the Strait of Hormuz is set to be unleashed on Asia, suddenly swamping a region that had managed to make up for lost supply in recent weeks. BBG

The average price of U.S. gasoline fell below $4 a gallon on Thursday for the first time in months, after Iran and the United States signed a preliminary agreement to cease hostilities for 60 days and reopen the Strait of Hormuz. The national average for a gallon of regular gasoline fell to a fraction of a penny below $4, down from $4.03 the day before, according to the AAA motor club. NYT

The MSCI China Index is on the cusp of a bear market, pressured by weakness in tech and consumer stocks. Alibaba and Tencent were the biggest drags on the day. BBG

The Bank of England held interest rates at 3.75% as it said the recent fall in oil prices was “encouraging.” Two of the nine policymakers voted for an immediate quarter-point hike over concerns of persistent inflation: BBG

The SNB left its key rate at zero as expected and said it retained its heightened readiness to sell the franc. Separately, the Swiss government trimmed its growth predictions for 2026 and next year, while slightly raising its inflation outlook. BBG

Brussels has opened communication channels with the Kremlin in recent weeks to scope out the potential for talks to end the war in Ukraine, as European capitals debate whether to engage directly with Russian President Vladimir Putin. FT

Norges Bank left its policy rate unchanged at 4.25%, as expected, but said it would likely be necessary to hike at one of the forthcoming meetings. Norges Bank

The U.K.’s unemployment rate inched down in the three months through April while wage growth remained flat, with continued weakness in the labor market reinforcing expectations that the Bank of England will keep interest rates on hold. WSJ

Microsoft Corp. has built a big business selling AI models to Chinese companies despite the growing rivalry between the US and China over artificial intelligence. ByteDance Ltd. has generally been Microsoft’s biggest AI customer in recent years, largely using OpenAI models, and is on track to spend more than $1 billion a year on Microsoft AI and cloud services. BBG

U.S. President Donald Trump said in a Truth Social post on Thursday that Apple has agreed to work with Intel to design and manufacture its ‌chips in the United States. RTRS

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Top Iran News(via @Newsquawk )

Technical talks between the US and Iran will be held in Zurich on Friday, Al Hadath reported citing sources. Talks will include the legal aspects related to lifting Iranian sanctions, the issue of frozen funds and the Iranian nuclear file. Qatar, Pakistan, Turkey, and Saudi Arabia will also attend the talks. An unannounced negotiation session will discuss issues related to Lebanon and Hezbollah.

The fifth round of US-Iran negotiations will discuss Israel's withdrawal along with a timetable for the experimental zone, Al Hadath reported citing a Lebanese source. The source added that the US-Iranian agreement will intensify pressure on Israel to gradually withdraw and that there will be no retreat from restricting weapons to the state and deploying the army in the south. Lebanon is proceeding with direct negotiations with Israel.

Swiss Foreign Ministry confirmed that the US and Iran will meet on Friday for initial talks on MoU execution.

The Swiss government, following the Iranian commentary, said the plan as it stands is still for the US, Iran, Pakistan and Qatar to meet on Friday in Switzerland to commence talks.

US War Secretary Hegseth said they are to review where the right place for basing is, when the Strait of Hormuz opens and are prepared to resume strikes and blockade if Iran does not comply with MoU.

US official said the Iran MoU was signed digitally on Sunday by US VP Vance and Iranian Speaker Ghalibaf, which was witnessed by US President Trump, while the US official said Iran MoU was signed on Wednesday by US President Trump and Iranian President Pezeshkian.

US official says that Iran is to arrange safe, no-charge passage through Strait of Hormuz for 60 days, according to CNBC.

Iranian Foreign Ministry spokesperson Baghaei said the MoU between the US and Iran was decided to be signed digitally, while the plan for negotiating teams in Geneva remains in place, but there will be no signing ceremony in Switzerland. Baghaei stated that the 60-day period had started and that Israel's continued attacks on Lebanon would be regarded as a breach of commitments, while he also commented that the US has begun lifting the blockade on Iranian ships and that no enriched nuclear material will be sent abroad, and the dilution of nuclear material remains an option. Furthermore, he said Iran will reciprocate if the US fails to honour commitments, and that Iran is to charge fees for Strait of Hormuz safety services, as well as stated that Iran and Oman are to manage the Strait of Hormuz security, and noted that Switzerland talks with the US are not yet certain.

Iranian Foreign Ministry spokesman said Israel's continued attacks on Lebanon would be regarded as a breach of commitments. The spokesman also said that the 60-day period starts today, according to the text.

Iranian Parliament Speaker and top negotiator Ghalibaf said the Strait of Hormuz will not return to pre-war conditions, but this does not mean acting against international laws or maritime navigation, while he added that payment for services through the Strait of Hormuz has been established in the MoU and that USD 300bln has been allocated to be invested in Iran, part of which will be spent on reconstruction. Furthermore, he said Iran's action is contingent on US compliance, with Iran to pursue action-for-action policy, as well as separately commented that Tehran can target ships entering Hormuz if needed, and that Tehran has sovereign rights to charge Hormuz tolls.

Source on Telegram posted that several IRGC boats were engaged in unspecified activity in the Strait of Hormuz, and that a US ship broadcast a warning message in Persian to tell them to cease operations and return to port, or else the US Navy would attack them.

An Israeli official said Israel has no intention of backing down on its positions and are holding stubborn negotiations with the US over its presence in southern Lebanon.

Israeli military operations reportedly continue in Lebanon despite the MoU, while Israel opposes Lebanon ceasefire terms in the US-Iran agreement, according to Al Jazeera.

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