Tonight Highlights | U.S.-Iran Signal Continued Talks; Oil Slides Below $100 as Global Equities Rally
Investor optimism regarding a potential U.S.-Iran deal drove U.S. stock futures and major European indices higher on Tuesday. Markets are also digesting a fresh wave of corporate earnings alongside cooling inflation data.
U.S. March Producer Price Index (PPI) rose 4.0% year-over-year, coming in below the 4.6% estimate. On a monthly basis, PPI increased 0.5%, also lower than the projected 1.1%, signaling a deceleration in wholesale price pressures.
Oil prices retreated while global stocks surged after both Washington and Tehran signaled room for continued negotiations. Brent crude futures are currently trading near $98 per barrel.
Diplomatic progress was noted as Iran’s Foreign Minister cited advancement in talks with France, while President Trump remarked that "the right people" in Iran still wish to reach an agreement.
Monday’s rally effectively erased all losses for the S&P 500 since the onset of the Iran conflict. Fundstrat’s Tom Lee noted that markets are "very good at discounting outcomes" and are pricing in a favorable resolution.
Tech stocks continue to anchor the broad market rally. Oracle jumped nearly 5% pre-market, while SanDisk rose over 1% following an "Outperform" initiation by Evercore ISI.
Banking results were mixed; J.P. Morgan fell pre-market after lowering its net interest income guidance despite an earnings beat. Wells Fargo slipped on a revenue miss, while Citigroup gained over 1%.
Q1 Earnings Snapshot
J.P. Morgan Beats Estimates but Trims Guidance
JPM reported adjusted Q1 revenue of $50.54 billion, beating the $49.26 billion estimate. Earnings per share (EPS) stood at $5.94, though shares softened on revised interest income outlooks.
Citigroup Profits Surge 42%
Citigroup posted Q1 revenue of $24.6 billion, up 14% year-over-year. Net income soared 42% to $5.8 billion, reflecting strong operational performance.
Wells Fargo Misses Revenue Targets
Wells Fargo reported Q1 revenue of $21.45 billion, falling short of the $21.76 billion estimate. Net interest income also trailed expectations at $12.1 billion.
Johnson & Johnson Raises Full-Year Outlook
J&J reported Q1 sales of $24.06 billion, up 9.9% and beating estimates. The company raised its full-year sales guidance to a range of $100.3 billion to $101.3 billion.
Corporate Briefs
OpenAI Valuation Scrutiny: Investors are questioning OpenAI’s $852 billion valuation as the company shifts focus to enterprise markets. Some fear the pivot leaves it vulnerable to competition from Anthropic and Google ahead of a potential IPO.
Microsoft Surface Price Hike: Microsoft has significantly raised prices for its Surface line in the U.S. Flagship models like the Surface Laptop 7 now start at $500 more than their 2024 launch prices.
Lucid Expansion: Electric vehicle maker Lucid expanded its partnership with Uber, securing a 35,000-vehicle purchase commitment and $750 million in new investment from Uber and Saudi Arabia's PIF-linked Ayar Third Investment.
Microsoft AI Agents: Microsoft is reportedly developing a "team of always-on" AI agents for Copilot. The feature aims to compete with OpenClaw’s capabilities within corporate enterprise applications.
HSBC Tokenized Deposits: HSBC launched a Tokenized Deposit Service (TDS) in the U.S. for institutional clients. The blockchain-based system allows 24/7 instant cross-border fund transfers and liquidity management.
Amazon Acquires Globalstar: Amazon officially announced the $11.57 billion acquisition of Globalstar. The deal intensifies its rivalry with SpaceX’s Starlink, which currently leads the market with 10,000 satellites.
Amazon Leo Aviation: Project Leo unveiled a high-speed aviation antenna offering up to 1 Gbps download speeds. Amazon has already secured partnership agreements with Delta and JetBlue.
Novo Nordisk x OpenAI: The pharmaceutical giant partnered with OpenAI to use advanced AI for drug discovery. The collaboration aims to analyze complex datasets to shorten the cycle from research to patient care.
LVMH Impacted by Conflict: LVMH reported a 6% decline in Q1 revenue to €19.12 billion. While U.S. and Asian markets showed steady growth, the Middle East conflict dragged organic revenue down by 1%.