Indices:
– U.S. equity index futures are slightly higher following a strong rebound session that saw markets erase losses tied to the Iran conflict opting to remain optimistic of an eventual agreement as oil prices filled the weekend gap, with (+1% to 6,886), (+1.1% to 25,383), (+0.6% to 48,218), and (+1.5% to 2,670) all advancing, and where there was notable strength in software names (see Stocks below); Treasury yields edged lower across the curve as optimism around a potential resumption in U.S.-Iran negotiations helped temper earlier inflation and oil-driven concerns, and market pricing (CME’s FedWatch) removes minority rate hike likelihoods for this year with a a significant minority in December
Stocks:
– Shares of Nvidia (NASDAQ:) (+0.3%) ended higher in what was a positive session for semiconductors and notable for Intel (+4.5%) enjoying its ninth consecutive day of gains up about 58% during the period, but it was a story of serious green for software stocks including Oracle (NYSE:) (+12.7%) as it touted some of its AI capabilities, Salesforce (NYSE:) (+4.
– Retail mixed on analyst calls with Williams-Sonoma (+2.3%) gaining on an upgrade out of Goldman Sachs, while Best Buy (-2.4%) fell suffering a double downgrade from the same financial firm with a significant reduction in its price target
– Travel and leisure hit slightly by fuel cost concerns with Carnival Corporation (-0.8%) and airlines including United Airlines (-1.2%), Delta Air Lines (-1.1%), and Southwest Airlines (-0.3%) all ending lower
– Shares of Nike (NYSE:) (+0.7%) managed to recover and end higher even after suffering another downgrade, this time from HSBC to hold and a price target cut roughly in half
– Meme stock movers: Beyond Meat (+10.6%), GoPro (21.8%),
– Crypto stocks track cryptocurrencies higher: Coinbase (+4%), MicroS
– Earnings:
o Goldman Sachs (NYSE:): earnings and revenue beat but falls short on trading in its fixed income, currencies and commodities unit; shares closed 1.9% lower
o Fastenal (NASDAQ:): earnings and revenue in line with forecasts; shares plummet 6.9%
o LVMH: organic sales growth misses estimate due to the conflict; shares close 0.3% lower
Commodities:
– prices recovered to fill the gap as it marches closer to $4.8K as yields fell back and likelihoods diminished, with a similar story playing out for not too far off $78 this morning and keeping the gold/silver ratio near 63
– Oil prices () fall back to $92 filling the weekend gap higher as markets reassess the impact of the U.S. naval blockade on Iranian shipping against reports that Washington and Tehran may still pursue further negotiations; President Trump reiterates that Iran “wants to make a deal”; IEA chief Birol that the agency remains prepared to act if necessary for another oil stockpile release; OPEC lowers its forecast for world oil demand in Q2 by 500K bpd (to 105.07m bpd) but makes no change to its full-year outlook anticipating consumption to rebound later this year and in all rise 1.38m bpd
FX/Central Banks/Crypto:
– rallies to breach $74K this morning as thus far markets shrug off the geopolitical shock, with a far better climb for Ether intraday not far off $2.4K and reaching a mid-term resistance level
– on the verge of breaking beneath 98 as weekend gap gets filled with oil prices falling back and giving energy-exposed and risk-related currencies a boost; backs off attempts to reach the 160 ‘red line’ falling into the lower 159s
– Federal Reserve’s (dove) Miran that the energy shock from the Iran conflict has not fed into longer-term inflation expectations, with inflation still seen returning to target within a year and no need for an aggressive policy response; President Trump’s Fed Chairman nominee Warsh filed the paperwork the Senate needs for his nomination to proceed
– European Central Bank’s De Guindos that policy decisions will hinge on second-round inflation effects from the conflict particularly via energy markets, and Vujcic that energy prices remain close to the base-case scenario despite their rise
– Bank of England’s Governor Bailey warns of a potential “double or triple whammy” if tighter financial conditions result in multiple vulnerabilities occurring at the same time
– Reserve Bank of Australia’s Hauser is unsure interest rates are at the right level to tame inflation
– Bank of Japan’s Ueda said that economic and price developments are moving roughly in line with their forecasts but they must “be vigilant to future developments” due to unstable global financial markets and rising oil prices
Capital.com Client Sentiment:
– Indices: Surprise price gains sees long bias drop in the S&P (61% from 64% at the start of the week), Dow (60% from 67% and no longer heavy buy), Russell (just 52% on the verge of shifting), and shifts in the Nasdaq (from a slight buy 51% to a slight sell 53%); elsewhere long bias also drops in the (62% from 67%) but climbs in the (extreme buy 80% from 78%) and (57% from 55%)
– Commodities: Falls out of extreme buy in gold (75% from 79% yesterday) while holds in silver (81%), and raise their heavy long sentiment in WTI (to 71% from 68% before the gap higher)
– FX: Shifts in (from a slight sell 54% at the start of this week to a slight buy 53% this morning), and majority sell bias increases in USD/JPY (to 60% from 55%) and (56% from 54%)
Data:
– U.S. for March decline to 3.98m, falling short of the 4.07m forecast and down from the previous 4.13m
– UK BRC’s like-for-like retail sales in March y/y accelerate to 3.1%, well above the 0.9% expected and prior 0.7% reading
– Chinese trade surplus plummets in March on a big increase in imports
Today:
– U.S. (4:30 pm Dubai time), ’s small business index (2 pm), API’s weekly energy inventory readings (1:30 am), several FOMC members speak
o Earnings from JPMorgan, Citigroup, Wells Fargo, J&J, and BlackRock
– IEA’s monthly Oil Market Report