U.S. Indexes and most sectors ended the day in the green amid broader risk-on trade as participants seemingly took sentiment regarding constructive remarks from the US on the conclusion of the Iranian war, although Iranian officials pushed back on this at every opportunity. Overnight, Trump’s said that the US could leave Iran in two to three weeks, which followed reports that the US could exit Iran without reopening the Strait of Hormuz, but Iran officials denied this, and comes ahead of the President’s address at 21:00EDT this evening; many of the details have been touted, as he will seemingly lambast NATO, and declare 2-3 more weeks of the war. Note, reports suggest that an imminent withdrawal/de-escalation is not expected. Geopolitics continues to dictate sentiment and price action, but there was quite a bit of US data, with the main driver being a strong ADP report, which topped expectations, ahead of the US jobs report on Friday. Retail sales and ISM also topped, with the prices metric soaring on the latter and survey respondents clearly concerned about the Iranian war. Back to sectors, Industrials and Communications outperformed, while Energy was the notable laggard and was hit by weakness in oil prices. Nike slumped post-earnings amid soft guidance and questions residing over the turnaround strategy, while Micron pared some of its recent selling. Precious metals gain, with Spot Gold outperforming its peers. Treasuries flatten as the ADP beat limited further upside in the short-end. Fed speak came via hawkish Musalem, Barr, and Barkin, albeit garnered little reaction. As mentioned, traders await Trump overnight. ISM Manufacturing in March rose to 52.7 from 52.4, above the expected 52.3. Prices jumped 78.3 (exp. 72.5, prev. 70.5), potentially on the Iran conflict, while New Orders dipped to 53.5 from 55.8. Employment was more-or-less unchanged at 48.7 from 48.8. Production and supplier deliveries edged higher to 55.1 (prev. 53.5) and 58.9 (prev. 55.1), respectively, and while inventories dipped to 47.1 from 48.8. Backlog of orders fell, but remained above 50, while new export orders and imports declined, with the former falling below 50. In survey respondents, Iran and the Middle East was a consistent topic, as it was the first report with panellists citing the Iran war as a new impact to their business. Recapping some of these remarks, 1) “The actions in Iran add a new wrinkle to energy costs throughout the world, and continue to try and plan for the unpredictable and unexpected”; 2) “Current Middle East unrest is already starting to impact business operations by increasing lead times, costs, container delays and the like.” 3) “Ongoing geopolitical instability has emerged as a persistent factor influencing global trade dynamics”. 4) “Middle East war has created domestic and global turmoil for the olefins and polyolefins business”. ADP Employment in March rose 62k, more-or-less unchanged from the prior 66k, and above the expected 40k. Median pay changes saw job-stayers’ wage growth unchanged at 4.5%, and job-changers ticked higher to 6.6% from 6.3%. The ADP employment report offsets the softer signal from Tuesday’s JOLTS report, with Oxford Economics noting its points to a labour market that is cooling gradually, not cracking. Given the Iran conflict, OxEco adds that March ADP figures are likely too early to see any effects of the US/Israel-Iran conflict, which they expect will weigh on hiring via delays and reduced demand. Regarding the growth on the headline, it was broad-based, with declines limited to manufacturing and trade/transport/utilities, while small firms continued to drive most of the hiring. Retail Sales growth was 0.6%, above the expected 0.4%, showing a decent rebound and the highest print in seven months from the prior decline of 0.2%. Behind the rebound was an increase in sales at department stores (3%), health and personal care stores (2.3%), and clothing (2%). The core gauge, Control Group, rose 0.5% (prev. 0.3%). Ex-autos increased 0.5% (exp. 0.3%, prev. 0.0%), and Ex-Gas/Autos rose 0.4% (prev. 0.3%). Oxford Economics expects the war with Iran to start impacting retail sales in March, as higher personal outlays for gasoline begin to crowd out discretionary spending. The firm cautions that the impact will take longer to materialise than normal, as households are benefiting from a large increase in tax refunds. Elsewhere, Oil closed lower by 2% while Gold continued its move higher with a further 2% gain on Wednesday.
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For anyone following my Platinum Service it made 660 points yesterday on the first trading session for April after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
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