Market Multiple Table: Renewed Optimism (Maybe a Little Too Much)

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What’s in Today’s Report:

  • Market Multiple Table: Renewed Optimism (Maybe a Little Too Much)

Futures are modestly lower on digestion of Wednesday’s big rally, as there was no negative news overnight.

Geopolitically, the U.S./Iran ceasefire is holding, for now, despite conflicting reports of violations.  The next key event is Saturday’s first round of negotiations.

Economically, German Industrial Production was slightly weaker than expected (0.0% vs. (E) 0.3% y/y).

Today the primary focus of markets will stay on geopolitics and whether the ceasefire holds.  While there are conflicting headlines, the key remains President Trump.  As long as he doesn’t post that the ceasefire is off, then regardless of other headlines, it’s still on (at least from a market standpoint).

Outside of geopolitics, we do get some notable economic reports including Jobless Claims (E: 213K), Core PCE Price Index (E: 0.3% m/m, 2.9% y/y) and Final Q4 GDP (E: 0.7%).  Of the three, the Core PCE Price Index is the most important but it’s February data (so before the war).  That said, if it’s higher than expected, that will only further increase inflation anxiety (which will be a mild negative on this market).

 

What the Ceasefire Means for Markets

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What’s in Today’s Report:

  • What the Ceasefire Means for Markets
  • Monthly Bitcoin & Cryptocurrency Update (April)
  • Durable Goods Orders Takeaways

Stock futures are sharply higher, and oil is down a staggering 15%+ this morning after a last minute ceasefire agreement between the U.S. and Iran was reached late yesterday, triggering broad risk-on money flows globally.

Looking ahead to today’s session, there are no noteworthy economic reports due to be released however, the Treasury will hold a 4-Month Bill auction at 11:30 a.m. ET and a 10-Yr Note auction at 1:00 p.m. ET which will shed light on bond traders “real” reaction to the ceasefire agreement. It will be important to see strong demand in the 10-Yr auction to assure investors stagflation worries have eased amid the ceasefire.

Additionally, while there are no Fed speakers today, the March Fed meeting minutes will be released at 2:00 p.m. ET and any insight on timing (and direction) of the FOMC’s next policy rate move has the potential to move markets this afternoon.

Finally, there are a few noteworthy earnings reports today including DAL ($0.61), RPM ($0.37), and STZ ($1.74), however, the primary market focus will remain on the ceasefire deal, and any geopolitical developments today, particularly negative ones that push back on the prospects that the deal is sustainable, could trigger a retracement of the massive overnight moves.

 

Oil Thresholds to Watch This Week

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What’s in Today’s Report:

  • All About Oil – Key Price Thresholds to Watch This Week
  • March ISM Services Index Takeaways – A Fresh Whiff of Stagflation

Stock futures reversed from modest overnight gains to trade with mild losses during the last hour as hopes for a U.S.-Iran ceasefire faded ahead of tonight’s deal-deadline.

Geopolitically, news that Iran has “rejected any temporary ceasefire with the U.S.” saw oil turn higher from overnight lows with WTI revisiting YTD highs near $115/barrel in pre-market trade.

Economically, the Final EU Composite PMI fell to 50.7 in March from 51.9 in February, slightly above the Flash reading of 50.5 but the data is not materially impacting markets given elevated geopolitical angst.

Looking into today’s session, there are two notable domestic economic reports to watch: Durable Goods (E: -0.2%) this morning and Consumer Credit (E: $12.0B) this afternoon.

Additionally, there are two Fed officials scheduled to speak: Goolsbee (12:35 p.m. ET) and Jefferson (5:50 p.m. ET) and a 3-Yr Treasury Note auction (1:00 p.m. ET). Either speaker or any unexpected strength/weakness in the auction has the potential to move bonds which could impact equities (falling yields are the best outcome for equities today).

 

Three Factors Supporting This Market

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What’s in Today’s Report:

  • Three Factors Supporting This Market
  • Weekly Economic Outlook – All Eyes on Inflation Data

Markets are trading with a tentative risk-on/”war-off” tone with U.S. equity futures modestly higher while oil prices are well off overnight highs thanks to hopes a last-minute ceasefire deal with be struck between the U.S. and Iran.

Geopolitically, President Trump reiterated threats to strike Iran’s civilian energy infrastructure if a ceasefire deal is not struck by an 8 p.m. ET deadline Tuesday.

However, Axios reported progress towards a 45-day ceasefire deal overnight which is bolstering hopes for a last-minute U.S.-Iran deal after military strikes persisted over the weekend with multiple U.S. aircraft notably being shot down by Iran.

There were no noteworthy economic reports overnight.

Today, geopolitical headlines will remain the primary market focus and any signs that a ceasefire deal is likely to be agreed upon between the U.S. and Iran has the potential to spark a continued relief rally, extending last week’s gains in equity markets.

There is however, one notable domestic economic report to watch, the ISM Services PMI (E: 55.4) and one Fed official scheduled to speak: Barr (9:10 a.m. ET) which traders will keep tabs on as they return to the desk after the long Easter weekend.

 

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Jobs Report Preview

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What’s in Today’s Report:

  • Jobs Report Preview

Futures are sharply lower on surging oil prices (up 7%) as President Trump pushed back on near term deescalation hopes in the U.S./Iran war during his prime time address.

President Trump reiterated a limited U.S. operation (lasting another few weeks) but warned of further near term escalation and gave no plan to reopen the Strait of Hormuz, reducing near term ceasefire hopes and sending oil higher.

There were no notable economic reports overnight.

Today focus will remain on geopolitics (anything that increases the chances of a U.S. ground assault will further boost oil and be incrementally negative for stocks) but we do get two important labor reports via Jobless Claims (E: 213K) and Challenger layoffs.  Given geo-political uncertainty, the stronger the labor market data, the better as it will push back on stagflation concerns (although the data won’t stop the selloff without positive geopolitical news).

There is also one Fed speaker today, Logan (10:15 a.m. ET), but she shouldn’t move markets.

 

Why Stocks Surged Yesterday

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What’s in Today’s Report:

  • Why Did Stocks Surge?
  • Housing Market Data Takeaways

Global equities surged overnight, tracking the big gains in U.S. stocks yesterday as both Trump and his Iranian counterpart signaled willingness to imminently end the war in the Middle East over the last 24 hours.

Economically, China’s Mfg PMI fell to 50.8 vs. (E) 52.5 while the Eurozone Mfg PMI firmed to 51.6 vs. (E) 51.4. Meanwhile, EU Unemployment rose to 6.2% vs. (E) 6.1%, however traders remain keenly focused on geopolitics and the data did not materially move markets overnight.

Today, the fresh geopolitical deescalation will remain the market’s primary focus, however there are several important U.S. economic reports due to be released including the ADP Employment Report (E: 40K), the ISM Manufacturing Index (E: 52.3), and the (delayed) February Retail Sales data (E: 0.4%).

Investors will be looking for Goldilocks data pointing to ongoing resilience but not data that is so strong it deters the Fed from considering 2026 rate cuts.

Finally, the Treasury will hold a 4-M Bill auction at 11:30 a.m. ET, which will shed light on rate traders’ outlook for Fed policy rates through the summer, and there are two Fed officials scheduled to speak ahead of the bell: Musalem (9:05 a.m. ET) and Barr (9:10 a.m. ET).

Regarding the Treasury auction and “Fed speak” the more dovish the reaction in Treasuries (yields lower), the better for stocks today.

 

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Why Kharg Island and Bab el Mandeb Matter to Markets

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What’s in Today’s Report:

  • Why Kharg Island and Bab el-Mandeb Matter to Markets

Markets were risk-on/”war-off” overnight (equities up, oil futures down) after the WSJ reported Trump is ready to end the U.S.-Iran war even if the Strait of Hormuz remains shut. Oil has rebounded since though, which is has tamped down risk-on money flows.

Economically, the EU HICP Flash was cooler-than-feared, rising to 2.5% vs. (E) 2.7%

Looking into today’s session, there are a handful of potentially market moving economic reports including the Case-Shiller Home Price Index (E: 1.4%), Consumer Confidence (E: 88.5), and JOLTS (E: 7.0 million) with the latter two being the key data points to watch.

Additionally, there are a handful of Fed speakers today with Goolsbee (12:00 p.m. ET), Schmid (1:10 p.m. ET), Barr (3:00 p.m. ET), and Bowman (5:10 p.m. ET) all due to deliver remarks.

Finally, some earnings reports to watch include: MKC ($0.61), TE ($0.03), NKE ($0.29), and RH ($2.21).

 

Pullback Update: What’s Happening, What Makes It Better/What Makes It Worse

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What’s in Today’s Report:

  • Pullback Update: What’s Happening, What Makes It Better/What Makes It Worse
  • Weekly Market Preview: Are there any Real Signs of De-escalation?
  • Weekly Economic Cheat Sheet: Jobs Report Friday (It’s a Busy Week for Data)

Futures are modestly higher in reaction to more positive commentary from President Trump on the war in Iran.

President Trump told the FT that Iran had agreed to “most of” the 15 point ceasefire plan and that is boosting futures.

Away from rhetoric, the conflict escalated further over the weekend as the Houthis attacked Israel while an Iranian missile struck a Saudi air base, damaging military aircraft. The gap between rhetoric and actual events in the conflict is keeping any gains in futures modest.

Today focus will remain on the U.S./Iran war and for this early bounce to hold, we’ll need to see some events on the ground also point towards de-escalation.  Away from the war, Fed Chair Powell speaks at 10:00 a.m., so his comments have the potential to move markets.

 

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Why the Fed’s Job Is Getting Harder

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What’s in Today’s Report:

  • Why the Fed’s Job Is Getting Harder

Futures are modestly lower despite an extension of the ceasefire negotiations between the U.S. and Iran.

President Trump announced a 10-day extension of pause on attacks on Iran’s infrastructure as talks are going “well.”

Despite positive rhetoric, the U.S. continued to mass troops in the region,  keeping escalation fears elevated.

Today focus will remain on geo-politics but in order for markets to sustainably rally, we’ll need to see some sort of confirmation of ceasefire progress from Iran, as the actions of the U.S. military (increased troops in the region) are offsetting the President’s positive comments.

Outside of geo-politics, we also get Consumer Sentiment (E: 54.3) and three Fed speakers, Barkin (11:00 a.m. ET), Daly (11:30 a.m. ET) and Paulson (11:35 a.m. ET), but they shouldn’t move markets.

 

Monitoring the Other Two Market Headwinds

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What’s in Today’s Report:

  • Monitoring the Other Two Market Headwinds

Futures are moderately weaker on Iranian denial of any imminent peach talks to end the U.S./Iran war.

Ceasefire hopes didn’t backtrack overnight, but they didn’t progress, either and that’s causing further giveback of this week’s rally.

Economically, the only notable report overnight was the German GfK Consumer Climate which was in-line (-28.0).

Today focus will stay on geo-politics and if cease-fire hopes fade further, oil will spike and stocks will drop, likely hard.

Beyond geopolitics, we get weekly Jobless Claims (E: 210K) and several Fed speakers including: Cook (4:00 p.m. ET), Miran (6:30 p.m. ET), Jefferson (7:100 p.m. ET) and Barr (7:10 p.m. ET) but they are unlikely to move markets.