SPX +1.18%, Nasdaq +1.96%, Dow +0.66%, R2K +1.32%. Brent dropped 4.25% to ~$95.15. Gold climbed 2.20%, silver rose 5.25%, and bitcoin jumped 1.50% to ~$74.3K. DXY fell 0.23%.
Treasuries rallied as yields fell 3-5 basis points across the curve, driven by cooler-than-anticipated PPI data and the drop in oil. The market is pricing in roughly 10 basis points of FOMC rate cuts this year.
We're turning neutral near-term after being constructive on the Iran situation. While we remain sanguine about the durability of the ceasefire (détente likely gets extended), our optimism is no longer contrarian. The SPX has surged ~10% from its March 30 trough of ~6300 in nearly a straight line, now hitting the 6900-7000 pre-war resistance zone. Technical tailwinds have diminished, though sentiment remains bearish (BoA survey shows fund managers at their most pessimistic since Q2 last year). Economic fallout from the war will persist even if fighting ends, keeping ~$90 as a Brent floor into summer.
Another face-to-face US-Iran meeting could occur within days as both sides remain in communication (Bloomberg, Reuters). The US proposed a 20-year uranium enrichment moratorium while Iran countered with a "single digit" period (Axios, NYT). Saudi Arabia is pressuring the White House to end the blockade and return to negotiations (WSJ). Europe is drafting plans to commit military resources to clear Hormuz of mines once fighting formally ends (WSJ). Singapore became the second country after Australia to tighten monetary policy since the war began (WSJ).
C reported solid Q1 EPS upside at $3.06 vs Street $2.66, driven by higher revenue (+14% to $24.6B vs $23.5B expected) and expense controls with efficiency ratio 200+ basis points better than anticipated.
JPM posted Q1 EPS of $5.94 vs expectations, beat driven by revenue upside ($50.5B vs $49.26B) and lower provisions ($2.5B vs $3.1B expected), though NIM fell short at 2.47%.
WFC reported modest EPS beat at $1.60 vs $1.58 expected, helped by expense controls and lower tax rate (11.6%), but total revenue missed at $21.4B vs $21.75B with NIM disappointment.
BLK delivered Q1 EPS upside at $12.53 vs $11.48, with revenue +27% to $6.698B, though long-term net inflows of $136B fell short of $146B expected due to fixed income weakness.
JNJ reported modest Q1 beat with EPS $2.70 vs $2.69 and sales $24.06B vs $23.65B, raising full-year guidance slightly.
GSAT will be acquired by AMZN for $90/share as Amazon bolsters its Leo satellite service to compete with SpaceX's Starlink.
AVNS agreed to be purchased by American Industrial Partners for $25/share cash vs Monday's close of $14.53.
Apr 15 — Empire Manufacturing Index, Import/Export Prices (8:30am), Fed Beige Book (2pm)
Apr 16 — Weekly jobless claims, Philadelphia Fed Index (8:30am), Industrial Production (9:15am)
Apr 15 — China GDP Q1, retail sales/industrial production (Wednesday night)
Wednesday Pre: BAC, PNC, MS, MTB, PGR
Wednesday Post: SLG, HOMB
Thursday Pre: ABT, BK, PEP, SCHW, TRV, USB, TSM, CFG, KEY, MRSH, PLD
Thursday Post: AA, NFLX
Friday Pre: ALLY, FITB, RF, STT, TFC, ALV
Coverage focuses on this week's schedule above. Major international names include ASML and Hermes before EU open Wednesday, plus various European financials and industrials throughout the period.