Trump Says Hamas Will Disarm as Gaza Deal Advances | Horizons Middle East & Africa 7/31/2026

Bank of Japan Holds Rates Steady [00:00:00]

• The Bank of Japan (BOJ) maintained its policy settings, leaving the overnight call rate unchanged at 1%.
• This decision was widely expected, with 52 economists surveyed by Bloomberg anticipating no change.
• A suspected currency intervention overnight aimed to support the yen, driving dollar-yen below the 160 handle.

  "The BOJ kept its policy settings unchanged and nudged its economic growth forecast higher, signaling confidence that the economy remains on track for further policy normalization."

Economic Growth Forecast Upgraded [00:00:00]

• The BOJ upgraded its forecast for fiscal year 2026 economic growth to 0.6% from 0.5% previously.
• This upgrade is attributed to global AI demand and other factors, indicating resilience in the Japanese economy.
• Risks to inflation are seen as skewed to the upside, with underlying inflation potentially overshooting the 2% target.

  "They're saying that the risks are skewed to upside for inflation. The underlying inflation could be overshooting its 2% target."

Gaza Peace Deal Claimed [00:01:52]

• President Trump claims a breakthrough in Gaza, stating the U.S.-led Board of Peace has reached an agreement for Hamas to disarm.
• The proposed deal involves a semi-simultaneous withdrawal of Israeli troops from Gaza and disarmament of Hamas, followed by a new Palestinian government.
• Questions linger about the feasibility, with Hamas anticipating Israeli withdrawal before disarmament and Israel's response yet to be fully detailed.

  "So broadly speaking, what the idea is, is that you will get some sort of semi-simultaneous withdrawal of Israeli troops from Gaza and a disarmament of Hamas and then a new Palestinian government comes in."

Red Sea Maritime Security Alliance [00:02:48]

• Saudi Arabia is attempting to establish a new multinational alliance to protect the Red Sea.
• Existing maritime task forces have been effective in similar situations, but the success of this new alliance depends on participating countries' resources and capabilities to counter missile and drone attacks.
• Brent crude prices are around $88 a barrel, down 1% on the day but up 5% for the month due to Middle East escalations.

  "The issue here is which countries are going to be prepared to put forward resources and do they have the resources that can be effective in this instance because ultimately what they're facing is missile and drone attacks potentially from the Houthis and not everyone necessarily has a navy capable of dealing with those threats."

Tech Rebound in Asian Markets [00:04:04]

• Asian equities are rallying, with the KOSPI showing a significant intraday performance, up 15% at one point.
• This rebound is underpinned by a rally in chip giants like Samsung and SK Hynix, driven by renewed investor interest in AI.
• A sovereign wealth fund's strategic investment plans in AI, including domestic assets, are also supporting tech stocks.

  "I mean, you're looking at the Kospi. At one point, its climb was the most on record, and it's underpinned by a 20 percent rally in the chip giants."

Apple's Sales Forecast Weighed Down by Shortages [00:08:10]

• Apple shares slid in aftermarket trading due to component shortages impacting its sales forecast.
• The company provided a revenue growth outlook of 9% to 11% for the September quarter, below market estimates of over 12%.
• Shortages of leading-edge processors and rising memory costs are expected to affect iPhone, Mac, and iPad sales in the upcoming quarter.

  "As shortages of those lead edge processors and rising memory costs, then go to iPhone, Mac, and particularly iPad in the quarter to come."

Amazon's Cloud Revenue Drives Stock Gain [00:08:50]

• Amazon shares rose significantly after reporting a fifth consecutive quarter of cloud revenue growth.
• Amazon Web Services (AWS) revenue increased by 37% to over $42 billion, easing concerns about returns on AI spending.
• AWS contributes about a fifth of Amazon's revenue and most of its operating profit.

  "Amazon jumped in late trade after reporting a fifth straight quarter of cloud revenue growth."

Geopolitical Tensions and Economic Impact [00:12:14]

• President Trump's announcement of a Gaza peace deal comes amid broader regional tensions, including between the U.S. and Iran.
• The war against Iran is described as unpopular in the U.S., and Trump is seeking political wins.
• The Middle East conflict is impacting regional economies, with Saudi Arabia experiencing its deepest quarterly contraction since the pandemic, largely due to its oil industry.

  "Well, there's no doubt that President Trump is looking for wins at this point. And the war against Iran is going very badly."