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Iran launches retaliatory attack on Israel with hundreds of drones

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Iran launched a swarm of explosive drones and fired missiles at Israel late on Saturday in its first ever direct attack on Israeli territory, risking a major escalation as the United States pledged “ironclad” backing for Israel.

Sirens wailed and Reuters journalists in Israel said they heard distant heavy thuds and bangs from what local media called aerial interceptions of explosive drones. Authorities said a 7-year-old girl was critically injured.

Israel’s military spokesperson Rear Admiral Daniel Hagari said Iran launched dozens of ground-to-ground missiles at Israel, most of which were intercepted outside Israeli borders. They included more than 10 cruise missiles, he said.

The Iranian salvo amounted to more than 200 drones and missiles so far, Hagari said, and had caused light damage to one Israeli military facility.

Read More – Iran launches drone attack against Israel

The Israeli military said later that it was not advising any residents to prepare to take shelter, revising an earlier alert in what appeared to signal the end of the threat.

Significant response

Israel’s Channel 12 TV cited an unnamed Israeli official as saying there would be a “significant response” to the attack.

Iran has vowed retaliation for what it called an Israeli strike on its Damascus consulate on April crimes”. Israel has neither confirmed nor denied responsibility for the consulate attack.

“Should the Israeli regime make another mistake, Iran’s response will be considerably more severe,” the Iranian mission to the United Nations said, warning the 1 that killed seven Guards officers including two senior commanders and said its strike was a punishment for “Israeli U.S. to “stay away”. However, it also said Iran now “deemed the matter concluded”.
United Nations Secretary-General Antonio Guterres condemned Iran’s attack, and said he was “deeply alarmed about the very real danger of a devastating region-wide escalation.”
U.S. President Joe Biden, who on Friday had warned Iran against an attack, cut short a visit to his home state of Delaware to meet national security advisers in the White House Situation Room. He pledged to stand with Israel.

“Our commitment to Israel’s security against threats from Iran and its proxies is ironclad,” he said on X after the meeting.

British maritime security company Ambrey said in a statement that drones were also reportedly launched against Israel by Yemen’s Iran-aligned Houthi group.

Those clashes now threaten to morph into a direct open conflict pitting Iran and its regional allies against Israel and its main supporter the United States, with regional power Egypt urging “utmost restraint”.

While Israel and Iran have been bitter foes for decades, their long feud has mostly unfolded via proxies or by targeting each other’s forces operating in third countries.

U.S. and British warplanes were involved in shooting down some Israel-bound drones over the Iraq-Syria border area, Channel 12 reported. Two U.S. officials said the U.S. military had shot down dozens of drone aircraft headed to Israel.

Major escalation

Israeli Prime Minister Benjamin Netanyahu, whose official jet took off shortly after the attack began, convened the war cabinet at a military headquarters in Tel Aviv, his office said.

Israel and Lebanon said they were closing their airspace on Saturday night. Jordan, which lies between Iran and Israel, had readied air defences to intercept any drone or missile that violated its territory, two regional security sources said.

Residents in several Jordanian cities said they heard heavy aerial activity.

Syria, an ally of Iran, said it was putting its ground-to-air defence systems around the capital and major bases on high alert, army sources there said.

The European Union, Britain, France, Mexico, Czechia, Denmark, Norway and the Netherlands all condemned Iran’s attack.

Israel has been bracing for an Iranian response to the Damascus consulate strike since last week, when Iran’s Supreme Leader Ayatollah Ali Khamenei said Israel “must be punished and shall be” for an operation he called equivalent to one on Iranian soil.

Biden said on Friday that his only message to Iran was “Don’t”, but added that “we are devoted to the defense of Israel.”

Iran’s main ally in the region, the Lebanese Shi’ite group Hezbollah that has been exchanging fire with Israel since the Gaza war began on Oct. 7, said early on Sunday it had fired rockets at an Israeli base.

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Nasdaq sell-off deepens amid AI stock concerns

Nasdaq sell-off worsens as AI stock valuations spark investor concerns and Palantir shares plummet despite strong earnings

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Nasdaq sell-off worsens as AI stock valuations spark investor concerns and Palantir shares plummet despite strong earnings

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In Short:
– Stocks fell due to concerns over AI valuations; S&P 500 down 1.2%, Nasdaq down 1.9%.
– Palantir shares dropped 9% despite strong performance, raising questions about sustainability of high valuations.
Stocks fell on Tuesday as investor concerns regarding artificial intelligence valuations impacted major indices.
The S&P 500 declined by 1.2%, and the Nasdaq Composite dropped by 1.9%, while the Dow Jones Industrial Average lost 304 points, equating to a 0.6% decrease.Palantir shares dropped 9%, despite the company’s strong third-quarter performance and positive forecasts attributed to its AI sector growth. The stock has surged over 150% this year, yet trades at over 200 times its forward earnings, leading investors to question whether such valuations can be sustained.

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Other tech stocks also faced declines, including Oracle and AMD, which saw drops of 4% and more than 3%, respectively.

Gains in AI stocks have inflated the S&P 500’s price-earnings ratio above 23, raising concerns about stock valuations. Ameriprise market strategist Anthony Saglimbene highlighted potential risks, stating that investors are questioning if future profit growth will support high capital expenditures.

Market Outlook

Comments from executives at Goldman Sachs and Morgan Stanley further added to market worries.

Both firms predicted potential market pullbacks, with drawdowns of 10% to 20% possible within the next two years. Saglimbene noted a narrow market breadth in recent months, suggesting limited alternatives if a downturn occurs in the tech sector.


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RBA predicts slow growth and limited interest rate cuts

RBA projects steady economic growth but no significant interest rate cuts, warning of ongoing cost-of-living challenges for Australians

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RBA projects steady economic growth but no significant interest rate cuts, warning of ongoing cost-of-living challenges for Australians

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In Short:
– RBA predicts persistent cost-of-living issues with low chances of interest rate cuts; economy growth expected at 2%.
– Unemployment rose to 4.5%, but is projected to remain steady; inflation is forecasted at 3.7% by next June.
RBA forecasts indicate ongoing cost-of-living struggles and a low likelihood of interest rate cuts. The Reserve Bank’s quarterly Statement on Monetary Policy (SMP) suggests Australia’s economy will grow at around 2% annually, primarily driven by housing investment.Banner

Unemployment rose to 4.5% last month but is expected to remain steady just below this level for the next two years. Some economists challenge this optimism. Productivity is improving more quickly than anticipated but remains relatively low by historical standards.

Inflation, meanwhile, is projected to stay persistently high despite solid growth and stable unemployment. The bank highlighted that last week’s inflation figures were significantly higher than expected, with the annual consumer price rise predicted to reach 3.7% by next June. With wage growth forecasted at only 3%, workers’ purchasing power is expected to decline.

No Rate Cuts

The RBA’s lack of interest rate cut forecasts have led markets to lower their expectations. The cash rate is predicted to bottom out at 3.3% next year, a revision from earlier projections of 2.9%. Many economists believe further cuts are unlikely, with a median expectation for no cuts until late next year.

RBA governor Michele Bullock acknowledged that maintaining the current rate is possible, noting that the RBA may not need to reduce rates significantly as other central banks have.

Competitive banking conditions offer some relief to borrowers, resulting in reduced spreads on variable-rate mortgages. Nonetheless, there are concerns that these spreads could increase as banks aim for higher profitability or as market risk premiums adjust. Australian variable mortgage rates may have reached their lowest point for the foreseeable future.


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Russia strengthens ties with China following Trump-Xi meeting

Russia strengthens ties with China following Trump’s positive meeting with Xi Jinping, aiming for deeper cooperation across various sectors

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Russia strengthens ties with China following Trump’s positive meeting with Xi Jinping, aiming for deeper cooperation across various sectors

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In Short:
– Russian officials emphasise their alliance with China after Trump’s meeting with Xi Jinping.
– Prime Minister Mishustin’s visit to China aims to strengthen trade and cooperation between the two nations.
Russian officials reaffirmed their alliance with China following U.S. President Donald Trump’s meeting with Chinese President Xi Jinping.Prime Minister Mikhail Mishustin arrived in Hangzhou for two days of negotiations, signing various agreements to enhance cooperation in trade, investment, energy, transport, agriculture, and space, according to Russian state media.

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Mishustin described his Chinese counterpart as a “dear friend,” stating that Russian-Chinese relations are at their peak despite Western sanctions. Li Qiang reciprocated by expressing Beijing’s readiness to strengthen ties, noting mutual support amid external risks and challenges.

Strategic Partnership

China remains Russia’s most important ally, having not condemned the 2022 invasion of Ukraine, and echoes Russia’s language, referring to the situation as a “crisis.”

Ahead of this visit, the Kremlin highlighted the significance of the talks, sending a robust delegation, including top officials from finance, agriculture, space, and nuclear energy.

Mishustin’s visit coincides with Trump’s recent discussions with Xi, where agreements were reportedly reached on several issues in a gesture seen as a trade truce amidst rising tariffs.

Trump’s engagement with China contrasts with his lack of progress in talks with Russia, which he attributed to frustrations over the Ukraine conflict. This context may indicate Russia’s unease regarding China’s positive interactions with the U.S.


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