Situation Awareness
Situation Awareness: Cautious Bearish. Renewed Iran conflict concerns sent oil surging and equity futures sharply lower overnight. The market is digesting President Trump’s renewed threats against Tehran. Trade mode: selective and defensive. The market is factoring in renewed geopolitical risk impacting oil prices and broader market sentiment. Regime context — 40% of stocks trade above their 40-day SMA, and the 4% Bull/Bear gauge shows 0 bulls vs. 0 bears. The 5-day trend shows a (data unavailable).
SIP: BNO DIA
- What’s working: Reversal signals are providing an abundance of opportunities (154 scan hits).
- Leading sectors: Energy (2.35); Utilities (2.04); Materials (-0.83). Leading themes: (Market closed — no live data).
- Heightened geopolitical risk after President Trump’s speech.
- Yesterday, stocks rebounded from opening lows to finish little changed as optimism surrounding a potential ceasefire faded.
- DEP watchlist: BA BTG CRML
- SIPS: AGIO COST LIN
Today’s Market Narrative
Equity futures are pointing to a sharply lower open this morning, reversing the optimism from the first two sessions of April. Renewed concerns about the Iran conflict, triggered by President Trump’s address to the nation last night, are sending oil prices soaring. Crude oil is currently up $9.23 (+9.2%) to $109.35 per barrel. Asian and European markets closed broadly lower, reflecting the escalating tensions and looming four-day Easter weekend that will keep major European markets closed through Monday.
Yesterday’s session saw a choppy trading environment, with major averages rebounding from early losses to finish near flat. The volatility stemmed from conflicting reports on the potential for a ceasefire in Iran. Early losses were later pared following a Bloomberg report suggesting Iran and Oman were drafting a proposal related to traffic through the Strait of Hormuz. Despite the rebound, the energy sector remained under pressure.
The economic calendar features the February Trade Balance and weekly initial jobless claims, both released at 8:30 a.m. ET. The initial jobless claims came in lower than expected at 202,000 (Briefing.com consensus 215,000), while the trade deficit widened to $57.3 billion (Briefing.com consensus -$55.8 billion). However, equity futures have shown little reaction to the data, suggesting the geopolitical situation is the primary driver.
Macro & Policy
The fog of war in Iran has clouded the market’s previously rose-colored outlook. Inflation concerns have increased due to rising oil prices resulting from shipping disruptions through the Strait of Hormuz. The market is still harboring hope that the Iran war can end soon but there is no clear sense that Iran harbors the same hope. The fed funds futures market has assigned a 37% probability to a 25-bps rate hike at the December FOMC meeting.
Treasuries recorded slim gains on Thursday, putting together a resilient showing from a modestly lower start to the trading day. Selling in global equities and sovereign debt was headlined by Japan’s 10-yr yield reaching its highest level in more than 20 years. The comments weighed on risk sentiment, but markets were eager to bounce during the U.S. session with Treasuries turning positive in the late morning while equities recaptured their losses by the time Treasuries settled for the day. The 10-yr yield climbed 4 bps to 4.36% following Trump’s more belligerent address to the nation regarding Iran.
Economic Calendar Today
- 08:30 ET: Weekly Initial Claims — Expected: 215,000 | Prior: 210,000 — A lower reading can signal a strong labor market, potentially influencing the Fed‘s rate decisions.
- 08:30 ET: February Trade Balance — Expected: -$55.8 bln | Prior: -$54.5 bln — A wider deficit could indicate weaker export demand and pressure on economic growth.
- 10:30 ET: Weekly natural gas inventories — Prior: -54 bcf — Changes in inventory levels can impact natural gas prices, affecting energy companies.
Earnings & Corporate News
Amazon (AMZN 205.80, -4.77, -2.3%) is reportedly in discussions to acquire Globalstar (GSAT 80.20, +11.67, +17.03). Shares of Globalstar surged +17.03% on the news. Acuity Brands (AYI) reported earnings this morning, beating EPS estimates but missing on revenue. Lindsay Corp (LNN) missed earnings by $0.55, missing on revs. Penguin Solutions (PENG) beat on EPS by $0.10, beat on revs and guided FY26 EPS in-line, revs above consensus, resulting in +10.2% gap up.
Analyst activity includes an upgrade for Brinker (EAT) to Overweight from Sector Weight at KeyBanc, tgt $177 with a downgrade for Akamai (AKAM) to Neutral from Outperform at Baird, tgt $110.
WaveFinder Signal Summary
The scans present a mixed picture, with relatively strong Reversal signals (154 hits), but scan environment is relatively weaker. Continuation signals are at 69, suggesting decent, but not overwhelming, breakout opportunities. The number of stocks above their 40-day SMA dropped to 40%, confirming a shift to cautious bearishness.
Today’s Watchlist
- BNO — Oil prices reacting to escalating Iran conflict, providing a short-term momentum play.
- LIN — showing 2LYNCH signal indicating continuation breakout with industrial tailwinds
- NKE — reversal signal in apparel
- GSAT — Acquisition potential could keep it moving higher; momentum play.
- PENG — Positive earnings driving a potentially breakout move.
- BA — D9M signal following contract news.
Action Codes of the Day
- BBT Big Bang Theory — Big volume before big move. The spike in oil prices following President Trump’s comments suggests BBT for energy-related plays.
- BTFD Buy The Dip — Given the overreaction to geopolitical headlines, BTFD may be a good strategy to capitalize on pullbacks in fundamentally sound companies.