Quick resolution to oil shock may push Fed to ease next year: Lombard Odier

• A US-Iran peace deal is expected to put a short-term market correction on hold and lead to a dramatic mean reversion or undershoot in oil prices.
• Lower oil prices are anticipated to reduce inflation, influencing real yields and making precious metals more appealing.
• The Fed is expected to pause rate hikes this year and potentially ease next year, contrary to current market pricing for further hikes.
• Mega IPOs are not seen as reliable indicators of a market top; focus should be on growth momentum and Fed policy.

John Woods of Lombard Odier discusses the market impact of a potential US-Iran peace deal, suggesting it could avert a short-term correction by easing oil supply shocks and leading to lower inflation. He anticipates the Fed will pause rate hikes this year and potentially ease next year, contrasting with current market pessimism for hikes. Woods believes mega IPOs are not reliable market top indicators.