Saudi Tadawul Rises on Israel‑Iran Ceasefire, U.S. Fed Holds Rates Steady at 4.25–4.50% with Two Cuts Expected | June 2025 Market Roundup

Key Points

• It seems likely that Gulf stock markets rebounded, with Saudi Arabia’s Tadawul up 1.21%, following an Iran-Israel ceasefire and growing bets on U.S. rate cuts.

• Research suggests these movements were influenced by geopolitical stability from the ceasefire and Fed projections for rate cuts, though exact impacts may vary.

Market Performance

On June 29, 2025, Saudi Arabia’s Tadawul All Share Index (TASI) closed at 11,202.64, marking a 1.21% increase from the previous trading day, aligning with the reported rebound in Gulf stock markets.

Reasons for the Rally

• Iran-Israel Ceasefire: A ceasefire was brokered by President Trump and took effect on June 24, 2025, likely boosting market confidence by reducing regional tensions.

• U.S. Rate Cut Expectations: The Federal Reserve, in its June 18, 2025, meeting, held rates steady but projected two cuts for the year, contributing to optimism in global markets.

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Survey Note: Detailed Analysis of Gulf Stock Market Rebound and Influencing Factors

This section provides a comprehensive overview of the recent rebound in Gulf stock markets, with a focus on Saudi Arabia’s Tadawul All Share Index (TASI) rising by 1.21%, and the contributing factors of the Iran-Israel ceasefire and growing bets on U.S. Federal Reserve rate cuts. The analysis is grounded in recent news and official data, ensuring a thorough understanding for readers interested in financial markets.

Market Performance Overview

On Sunday, June 29, 2025, the Tadawul All Share Index (TASI) closed at 11,202.64, reflecting a 1.21% increase from the previous trading day’s close of 11,068.27, as per data from Yahoo Finance Tadawul All Share Index. This performance aligns with the user’s statement that the Tadawul was up 1.2%, with the slight variation likely due to rounding. Given that today is Sunday, and the Tadawul operates from Sunday to Thursday with trading hours from 10:00 AM to 3:10 PM AST, the closing value represents the most recent data available for June 29, 2025. The market’s rebound is part of a broader trend in Gulf stock markets, which have shown resilience amid geopolitical and economic developments.

The 1.21% gain was supported by significant trading activity, with a volume of 250,441,849 shares traded on the day, compared to an average volume of 173,799,069, indicating heightened investor interest . Over the past 52 weeks, the TASI ranged from 9,930.86 to 13,949.13, showing volatility but also a strong recovery in recent sessions.

Influencing Factors: Iran-Israel Ceasefire

The ceasefire between Iran and Israel, brokered by President Trump, was a significant geopolitical development that likely contributed to the market rebound. The ceasefire took effect on June 24, 2025, following a period of intense conflict that included missile strikes and retaliatory actions. According to The New York Times: Israel and Iran Claim Victory as Cease-Fire Takes Hold, both nations claimed victory, and the ceasefire was seen as a step toward de-escalation. BBC News: Israel-Iran ceasefire: What we know about the deal reported that the truce came after Israel launched strikes on June 13, 2025, targeting Iranian nuclear facilities, with Iran retaliating, leading to a volatile period before the ceasefire was imposed.

For Gulf markets, particularly Saudi Arabia, the ceasefire likely reduced uncertainty in the region, as Iran and Israel’s conflict has historically impacted oil prices and regional stability. The reduction in geopolitical risk could have encouraged investors to return to the market, boosting indices like the Tadawul. Reports indicate that oil prices, which had spiked due to the conflict, began to stabilize post-ceasefire, with U.S. oil trading below $70 a barrel by June 23, 2025, as noted in CNN: June 23, 2025 - Israel-Iran conflict, potentially benefiting energy-dependent economies like Saudi Arabia.

Influencing Factors: Growing Bets on U.S. Rate Cuts

Another key driver of the market rally was the growing anticipation of U.S. Federal Reserve rate cuts. At its June 18, 2025, meeting, the Federal Open Market Committee (FOMC) decided to maintain the target range for the federal funds rate at 4.25% to 4.5%, where it has been since December 2024 . However, the Fed’s updated projections, as reported by Trading Economics: United States Fed Funds Interest Rate, still anticipate two rate cuts by the end of 2025, signaling a potential easing of monetary policy.

Fed Governor Christopher Waller, in a statement on June 20, 2025, suggested that the central bank could cut rates as early as July, citing that inflation is no longer a major threat ([CNBC: Fed Governor Waller says central bank could cut rates as early as July]([invalid url, do not cite])). This view was partially supported by Fed member Michelle Bowman, who indicated that a rate cut should be on the table in July, though Fed Chair Jerome Powell emphasized caution, stating on June 24, 2025, that rate cuts can wait as the Fed studies the impacts of potential tariffs ([AP News: Powell says Fed rate cut is on hold even as Trump demands cuts]([invalid url, do not cite])). The market’s optimism likely stems from these projections and statements, anticipating lower borrowing costs that could stimulate economic activity, particularly in emerging markets like the Gulf region, which are sensitive to global liquidity conditions.

Comparative Analysis of Market and Economic Indicators

To provide a clearer picture, below is a table summarizing key market and economic indicators from June 29, 2025, for the Tadawul:

Indicator	Value	Notes
TASI Closing Price	11,202.64	Up 1.21% from previous close
Previous Close	11,068.27	Reflects trading on June 26, 2025
Volume	250,441,849	Higher than average volume of 173,799,069
52 Week Range	9,930.86 - 13,949.13	Indicates volatility and recovery

This table highlights the Tadawul’s performance and the context of trading activity, reinforcing the connection between market movements and the discussed factors.

Below is another table summarizing the geopolitical and economic events influencing the market:

Event	Date	Impact on Market
Iran-Israel Ceasefire	June 24, 2025	Reduced geopolitical risk, boosted confidence
Fed Rate Cut Projection	June 18, 2025	Anticipated lower rates, increased liquidity

These tables provide a structured overview of the data supporting the market rebound.

Conclusion and Implications

The rebound in Gulf stock markets, particularly the 1.21% rise in Saudi Arabia’s Tadawul on June 29, 2025, appears to be driven by a combination of the Iran-Israel ceasefire and growing expectations of U.S. Federal Reserve rate cuts. The ceasefire, effective from June 24, 2025, likely reduced regional uncertainty, while the Fed’s projection of two rate cuts for 2025 has fueled optimism for global liquidity. As of Sunday, June 29, 2025, with no further trading days until Monday, June 30, 2025, these developments remain the latest influencing factors. Investors and analysts will likely continue monitoring the stability of the ceasefire and the Fed’s July meeting for further clarity on these fronts.

Key Citations

• Saudi Exchange Market Summary

• Yahoo Finance Tadawul All Share Index

• The New York Times Israel and Iran Claim Victory as Cease-Fire Takes Hold

• BBC News Israel-Iran ceasefire What we know about the deal

• U.S. Bank Federal Reserve holds interest rates steady while investors anticipate two cuts

• Trading Economics United States Fed Funds Interest Rate

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