Situation Awareness
Situation Awareness: Cautious. Market finding its way to an Iran off-ramp, sparking a risk-on rally but uncertainty remains high. Trade mode: selective and defensive. Focus will be on President Trump’s evening address and the February Retail Sales and March ISM Manufacturing Index data. Regime context — 31.6% of stocks trade above their 40-day SMA, and the 4% Bull/Bear gauge shows 324 bulls vs. 106 bears. The 5-day trend shows (data unavailable), signaling (data unavailable).
SIP: MLYS HUBC FBLG RYM
- What’s working: Reversal scans are rich with nearly 100 signals, but their high risk profiles need confirmation.
- Leading sectors: No trending data available. From Sector Volatility ATR: Energy (2.04), Utilities (1.51), Materials (-0.22); leading themes: No trending data available.
- President Trump’s address on Iran tonight.
- Market read: Yesterday’s surge was driven by hopes for de-escalation, but the path forward remains unclear. Watch for confirmation or reversal of this sentiment, driven by President Trump’s address.
- DEP watchlist: AA, STLA, GDX
- SIPS: ETR , FCN
Today’s Market Narrative
Equity futures are pointing to a higher open today, extending yesterday’s impressive gains which saw major averages surge by 2.5% or more. This rally was fueled by reports suggesting a potential de-escalation of the conflict between the U.S. and Iran. Optimism is further boosted by reports that President Trump anticipates a U.S. withdrawal from Iran within a few weeks, even without a formal deal. Asian markets kicked off April with a strong showing, led by South Korea’s Kospi, which jumped +8.4%. European markets are also trading in the green, reflecting the improved geopolitical outlook.
The retreat in oil prices is a key factor supporting risk appetite, with crude currently down $2.76 (-2.7%) to $98.62 per barrel. This decline is attributed both to the prospect of a ceasefire and a Wall Street Journal report indicating that the United Arab Emirates may pressure Iran to reopen the Strait of Hormuz, potentially by force. Investors will be closely watching President Trump’s address tonight for confirmation of the administration’s stance on the conflict.
Sector performance is mixed. Technology and growth sectors are expected to continue yesterday’s momentum, while Energy faces headwinds from lower oil prices. Keep an eye on NKE, which is gapping down after disappointing guidance, impacting consumer discretionary sentiment. Watch for sector rotation as traders adjust their portfolios in response to the evolving geopolitical and economic landscape.
Macro & Policy
The bond market is reacting to improved risk sentiment and better-than-expected economic data. Treasury yields saw a brief increase after strong March ADP employment growth and above-consensus February Retail Sales figures, with the 2-yr note yield rising. The ISM Manufacturing Index for March came in at 52.7%, slightly above the Briefing.com consensus of 52.3%, signaling continued expansion in manufacturing activity with ongoing upward pressure on input prices.
According to updated Bond Market intelligence: “Longer-dated Treasuries are back near their starting levels while shorter tenors are a bit behind, though the entire complex is back to little changed.” It’s important to note that the expectation earlier in the year of a rate cut in 2026 is now not accounted for, and there’s a 37% probability assigned to a 25-basis-point hike at the December FOMC meeting.
Economic Calendar Today
- 07:00 ET: Weekly MBA Mortgage Index — Actual: -10.4% | Prior: -10.5% — Reflects housing market activity and impacts rate-sensitive sectors.
- 08:30 ET: February Retail Sales — Briefing.com consensus: 0.5% | Prior: -0.2% — A key indicator of consumer spending and economic health.
- 10:00 ET: March ISM Manufacturing — Briefing.com consensus: 52.3% | Prior: 52.4% — Important gauge of manufacturing activity and overall economic conditions.
- 10:30 ET: Weekly crude oil inventories — Prior: +6.93 mln — Influences energy prices and sentiment.
- Earnings reporting today (pre-market): CALM, CAG, LW, MSM, UNF
Earnings & Corporate News
Nike (NKE) is under pressure in the pre-market, down -10.9% at $47.05 after beating EPS estimates but providing weak Q4 revenue guidance, particularly expecting Greater China revenues to decrease approximately 20%. Conagra (CAG) is trading lower after missing EPS expectations by $0.01, with revenues in-line. The company also lowered its FY26 EPS outlook. Conversely, nCino (NCNO) is gapping up after beating on EPS by $0.16 and revenues, alongside strong guidance and a $100 million accelerated share repurchase program.
Microsoft (MSFT 376.25, +6.08, +1.6%) is reportedly in talks with Chevron (CVX 204.06, -2.84, -1.4%) and an investment fund for a power plant in Texas, potentially impacting the energy sector. OpenAI’s recent $122 billion funding round, valuing the company at $852 billion, highlights continued investor interest in AI. Analyst downgrades of NKE, including downgrades to Neutral from Buy at BofA, Goldman, and JPMorgan, indicate shifting sentiment towards the stock.
WaveFinder Signal Summary
The scan environment is cautiously optimistic. While the raw number of names above their 40-day SMA has dropped versus yesterday (31.6% from 39%), meaning breadth is declining, the overall 4% Bull/Bear gauge indicates more bulls than bears (324 vs 106). The number of stocks above the 20 SMA has declined significantly.
Standout setups include several continuation signals including ETR and FCN. A delayed 9M list includes AA and STLA, suggesting strong medium-term momentum.
Today’s Watchlist
- NKE — Bearish after earnings miss and weak guidance; good short opportunity.
- MSFT — Benefiting from overall market sentiment and AI momentum, long idea.
- ETR — Utility sector strength with positive trend, continuation breakout.
- FCN — Services sector, Continuation, could rally today.
- CAG — Food supplier, down after earnings, wait for price to settle.
- AA — Mining industry, D9M signal, potential trend reversal.
Action Codes of the Day
CRT Controlled Risk Taking — Market sentiment is improving, but geopolitical risks remain, so selective and controlled risk-taking is warranted.
COUGAR Patience play — The market still harbors hope to see a resolution of war with Iran, but there’s no clear sense that Iran harbors the same hope.