Sevens Report - Market Analysis

What Could Go Wrong for This Market?

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What’s in Today’s Report:

  • What Could Go Wrong for This Market?
  • Weekly Market Preview: Does the ceasefire finally happen?
  • Weekly Economic Cheat Sheet: A big week for inflation

Futures are little changed despite no incremental progress on an official U.S./Iran ceasefire over the weekend.

On Sunday night President Trump declared Iran’s response to the ceasefire terms “totally unacceptable” and oil is rallying as a result, although markets still believe a ceasefire agreement will be reached (so stocks aren’t down much).

Economically, Chinese CPI rose more than expected (1.2% vs. 0.9% y/y) reflecting the inflationary effects of higher energy prices.

Today focus will stay on geopolitics as there’s only one economic report, Existing Home Sales (E: 4.05M), and it shouldn’t move markets.  Regarding the U.S. and Iran, as long as the U.S. does not initiate widespread attacks on Iran again, markets will continue to view the situation as slowly trending towards a ceasefire (and it shouldn’t be a material negative for stocks).

 

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