There is a big uncertainty about whether Lebanon is involved in the ceasefire and if Iran will accept it if not. There is a report that a ship was turned around due to strikes on Lebanon.
At the same time, Iran itself seems to be violating the agreement as it has sent drone strikes today. That could just be due to the difficulty in relaying the news or due to rogue commanders but it's all looking precarious. With that, the S&P 500 trimmed its gain to 2.0% on the day.
Pakistani PM Shehbaz Sharif posted:
Violations of ceasefire have been reported at few places across the conflict zone which undermine the spirit of peace process. I earnestly and sincerely urge all parties to exercise restraint and respect the ceasefire for two weeks, as agreed upon, so that diplomacy can take a lead role towards peaceful settlement of the conflict.
Turkey's Erdogan also evidently spoke with President Trump and afterwards the readout said that "no opportunity should be given for the ceasefire process to be sabotaged".
Beyond the ceasefire itself, there's the thorny issue of the peace deal as it's not at all clear on what the sides have agreed to, at least publicly. It will likely take far more than 2 weeks to get a definitive deal and Trump's habit of threats and brinkmanship make for a precarious dynamic.
Ultimately, I have to believe there will be a deal because the closure of Hormuz was unpopular in the US, along with the spike in gasoline prices. It's also not clear that the US had the will or the means to permanently re-open the Strait.
So the bombs have stopped flying in the Gulf region but the headache hasn't gone away. That makes it tough to hold any conviction in a positive scenario and why some of the biggest gainers at the start of the day have faded.
I think messages around Lebanon are worth watching carefully but I also have doubts that's truly a red line for Iran.
Looking ahead, the White House is holding a press briefing at 1 pm. The New York Times writes that a White House official said that the 10-point peace plan that Iran publicly released on Wednesday differs from the plan that Trump said was a “workable basis on which to negotiate.” The official declined to elaborate on the differences but said Karoline Leavitt, the White House press secretary, was expected to clarify today.
