Full Breakdown
Market Rally on August 13: Stocks Rise Amid Mild U.S. Inflation and Gulf Tensions
8/13/2026, 4:21:43 AM
Core Event
On August 13 Asian equity indexes and U.S. markets posted gains after U.S. consumer-price data for July showed a 0.1 % increase, matching expectations. The modest reading eased bets that the Federal Reserve would raise rates at its September meeting, while oil prices stayed elevated as the United States and Iran remained deadlocked over the Strait of Hormuz. MSCI’s broadest Asia-Pacific index outside Japan rose 0.97 %, led by a 4.4 % jump in South Korea’s KOSPI, while Japan’s Nikkei gained 1.86 %. In the United States, the S&P 500 climbed 0.26 % to 7,748.50 and the Nasdaq Composite rose 0.54 % to 26,588.49, buoyed by earnings from AI-infrastructure firms such as CoreWeave.
Background & Context
The July CPI report showed headline prices up 0.1 % and the core index (excluding food and energy) rising 0.2 % month-over-month, the slowest pace since March 2021. Analysts were watching the data for clues on whether the Fed would resume tightening after earlier rate hikes. At the same time, Gulf tensions persisted: a senior Iranian source said talks to revive a June interim agreement on the Strait of Hormuz had made no progress, and President Donald Trump asserted that the United States has “total control” over the waterway, a claim Iran rejected.
Data & Statistics
- MSCI Asia-Pacific (ex-Japan) index: +0.97 %
- South Korean KOSPI: +4.4 %
- Japan’s Nikkei: +1.86 %
- U.S. CPI (July) headline: +0.1 % (in line with forecasts)
- Core CPI (July) month-over-month: +0.2 % (annual 2.5 %)
- Brent crude: around $88 per barrel (steady)
- U.S. crude: $82.58 per barrel (down 0.83 %)
- Probability of a Fed rate hike in September (CME FedWatch): ~40 % (down from 54 % a week earlier)
Official Statements & Responses
President Donald Trump claimed the United States holds “total control” over the Strait of Hormuz, a statement Iran’s officials dismissed. A senior Iranian source told Reuters that negotiations to revive the June interim agreement “made no headway.”
Den Miki, senior rate strategist at SMBC Nikko Securities, noted that the Fed and markets will likely assess the CPI data up to the September policy meeting.
Verbatim Quotes
- “The numbers came in right in line. The market’s reaction is slightly positive because the market was fearful it was going to come in worse than it did. You’re seeing a market thinking that the Fed is not being pushed toward a rate hike,” — Robert Pavlik, senior portfolio manager at Dakota Wealth
- “Our base case for a long time has been a gradual but messy de-escalation,” — Dorian Carrell, head of multi-asset income at Schroders
Conflicting Reports & Gaps
- Oil-price impact: Some sources emphasized that oil prices “remained elevated,” while others noted a modest decline in U.S. crude and a slight rise in Brent, leaving the net direction ambiguous.
What’s Next
Traders will watch the upcoming U.S. CPI release later in the week, expected to show a headline near 3.4 %, which could further shape expectations for the Fed’s September decision. In the Gulf, no timetable has been set for a resolution to the Strait of Hormuz dispute, and both sides have signaled continued hardening of positions.
