Risk sentiment surged on Thursday after Trump cancelled planned strikes on Iran, citing a near-complete deal with Tehran and a possible signing in Europe this weekend. Equities rallied hard, led by cyclicals and tech, while energy was the lone sector in the red. Oracle bucked the broader rally, sliding over 8% on its USD 40bln equity raise following weak capex guidance.

Crude bore the brunt of the de-escalation, reversing earlier gains to settle sharply lower, which in turn fuelled a broad Treasury rally. Yields fell 8-10bps across the curve, led by the belly, as traders unwound inflation premiums tied to the conflict. Markets now price just 18.5bps of hikes by year-end, a 74% chance.

The USD softened broadly on the improved risk tone, with AUD and NZD outperforming on the constructive backdrop, while CAD lagged on crude's slide.

US PPI added a wrinkle: headline rose 1.1% m/m (exp. +0.7%, prior +1.4%) and 6.5% y/y (exp. +6.4%), but core cooled to 4.9% y/y (exp. +5.3%, prior +5.2%). Supercore reaccelerated to 5.1% y/y, a reminder underlying pressures haven't fully faded. Jobless claims ticked up to 229k (exp. 219k, prior 225k).

A weak 30-year auction, tailing 1.2bps with soft indirect demand, underscored lingering caution on duration even with yields near 5%. Iran's Supreme Leader sign-off remains the key swing factor heading into the weekend.

Another deal, this time for sure?

This article was written by Eamonn Sheridan at investinglive.com.

from Investinglive RSS Breaking News Feed https://ift.tt/x0ikQYb
via IFTTT