Happy Monday to all the bulls out there, and to the oil bears.
There was an inkling of what was coming on Friday’s price action and we got confirmation over the weekend as the US halted strikes. It doesn’t sound like a deal is imminent but the shooting has stopped and that’s leading to some early optimism.
S&P 500 futures opened 60 points higher, though they’ve quickly pared that to 50 points. Aside from rate-sensitive equities, there will be a focus on earnings again this week with some major names set to report. Nasdaq futures are leading the way, up 1.4%.
Brent crude is down 5% and WTI is down 4% in the first trades of the day. The WTI decline has quickly extended to $5.42, or 6%, to $83.80.
Gold is also up $35 to $4088 as it tries to sustain last week’s gains.
The FX market flagged this type of open earlier and now the challenge will be to hold the gains throughout the day. As time ticks on, we will wait for word from Trump regarding the next steps for negotiations with Iran. I fear that we will see a squeeze that doesn’t last.
