Alex Ridges of StoneX discusses why the US dollar is hitting 13-month highs despite easing US-Iran tensions — hawkish Fed repricing is overwhelming safe-haven outflows. He also breaks down the SpaceX IPO's post-listing plunge, noting a quick-fire debt offering spooked investors, and analyzes retail client positioning on upcoming OpenAI and Anthropic IPOs — clients are 4:1 long on OpenAI and 10:1 long on Anthropic, betting big on AI despite cost concerns.
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Alex Ridges, StoneX's global head of retail dealing, walks through two intertwined market stories: the dollar's counterintuitive rally and the retail appetite for AI IPOs. **The dollar conundrum**: Despite easing US-Iran tensions — which normally triggers safe-haven outflows from the dollar — the DXY has hit 13-month highs. Ridges attributes this to a hawkish Fed repricing that caught clients off guard. CPI came in at 4.2%, a three-year high, and the Fed's latest meeting produced no rate change but crucially removed all language about future cuts. Half of FOMC members now project a rate hike by year-end. Ridges notes the market had expected the new Fed chair (a Trump appointee) to maintain dovish rhetoric, but the opposite materialized. …
Hawkish USD: the market is still digesting the Fed's removal of cut language and the shift toward rate hikes, with dollar momentum intact as rate differentials widen against EUR/GBP. Risk assets face a headwind from rising yields competing with speculative capital.
If US inflation stays elevated above 4% and the Fed follows through on hawkish guidance, the dollar bull run extends beyond tactical positioning into a sustained trend — but the path hinges on whether European growth stabilizes and whether AI IPOs can decouple from the rates-driven risk-off correlation.
The regime shift from cheap capital to structurally higher funding costs is the durable macro story; AI and speculative technology ventures that depend on abundant cheap money will face ongoing valuation headwinds, rewarding cash-flow generation over promise.
US dollar has reached a 13-month high against major peers due to hawkish Fed expectations, not safe-haven flows from geopolitics.
The speaker notes that despite geopolitical tensions easing which would normally weaken the dollar, it has strengthened because of hawkish Fed stance driven by high inflation.
Half of Fed members are now predicting a rate rise by the end of the year.
Speaker references the latest Fed meeting where language about cuts was removed and a significant portion of members shifted to forecasting a hike.
Could a hawkish Fed stance be affecting the SpaceX IPO?
He thinks tighter money matters because investors no longer assume cheap dollar funding. That makes risk assets like SpaceX less attractive compared with safer alternatives.
Is Anthropic’s story different from OpenAI’s, and what is driving investor interest there?
He says Anthropic is a bit different because its product was briefly made unavailable again, but usage costs are very high and the model could still monetize computing power well. Investors are waiting on what the US government will allow next.
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