June S&P 500 E-Mini futures (ESM26) are down -1.27%, and June Nasdaq 100 E-Mini futures (NQM26) are down -1.65% this morning as doubts over a quick resolution to the Middle East conflict dampened sentiment and fueled a spike in oil prices.

In a primetime address on Wednesday, President Trump said that the U.S. is “going to hit [Iran] extremely hard over the next two to three weeks. We’re going to bring them back to the stone ages, where they belong.” Mr. Trump provided little clarity on when the war would end and said U.S. military objectives would be achieved “very shortly.” He also said allies that rely on Middle East oil shipped through the Strait of Hormuz should “go to the strait and just take it, protect it, use it for yourselves.”

The price of WTI crude jumped over +8% after President Trump’s address crushed hopes for a near-term reopening of the crucial Strait of Hormuz. The move showed up in the bond market, with the 10-year T-note yield rising five basis points to 4.37% as the prospect of higher-for-longer oil prices rekindled inflation concerns and prompted traders to trim the odds of a 2026 Fed rate cut to about 10% from more than 20%.

In yesterday’s trading session, Wall Street’s three main equity benchmarks ended in the green. Chip and AI-infrastructure stocks rallied, with Western Digital (WDC) jumping over +10% to lead gainers in the S&P 500 and Nasdaq 100, and Micron Technology (MU) rising more than +8%. Also, mining stocks climbed as gold and silver prices advanced, with Newmont (NEM) gaining over +5% and Freeport McMoRan (FCX) rising more than +4%. In addition, Boeing (BA) advanced over +4% and was the top percentage gainer on the Dow after Wells Fargo initiated coverage of the stock with an Overweight rating and a price target of $250. On the bearish side, Nike (NKE) tumbled more than -15% and was the top percentage loser on the S&P 500 and Dow after the sportswear giant said revenue is projected to fall 2% to 4% in the current quarter and decline in the low single digits for the remainder of the calendar year.

The ADP National Employment report released on Wednesday showed that U.S. private nonfarm payrolls rose by 62K in March, stronger than expectations of 41K. Also, U.S. retail sales climbed +0.6% m/m in February, stronger than expectations of +0.5% m/m, while core retail sales, which exclude motor vehicles and parts, rose +0.5% m/m, stronger than expectations of +0.3% m/m. In addition, the U.S. March ISM manufacturing index unexpectedly rose to 52.7, stronger than expectations of 52.3.

St. Louis Fed President Alberto Musalem said on Wednesday that risks to both inflation and employment are rising, and officials should be ready to adjust interest rates in either direction depending on how the economy evolves. “I will support adjustments in the stance of policy if the evidence indicates the economy requires them,” Musalem said.

Meanwhile, U.S. rate futures have priced in a 97.4% chance of no rate change and a 2.6% chance of a 25 basis point rate hike at this month’s monetary policy meeting.

Today, investors will focus on U.S. Initial Jobless Claims data, set to be released in a couple of hours. Economists project this figure to be 212K, compared to last week’s number of 210K.

U.S. Trade Balance data will also be released today. Economists forecast that the trade deficit will widen to -$60.5 billion in February from -$54.5 billion in January.

In addition, market participants will be anticipating speeches from Fed Vice Chair for Supervision Michelle Bowman and Dallas Fed President Lorie Logan.

Investors are also keenly awaiting the U.S. March Nonfarm Payrolls report, which will provide a snapshot of the health of the nation’s labor market. The key U.S. jobs report will be released on Friday, when U.S. stock markets will be closed in observance of Good Friday. Economists estimate that 65K jobs were added last month following a 92K decline in February. The unemployment rate is expected to hold steady at 4.4%.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.37%, up +1.09%.

The Euro Stoxx 50 Index is down -1.82% this morning, with investors opting to lock in profits ahead of the long Easter weekend as hopes for a swift resolution to the Middle East conflict faded following comments from U.S. President Trump. Technology, mining, and bank stocks sank on Thursday. At the same time, energy stocks climbed amid a jump in oil prices. Despite Thursday’s drop, the benchmark index is on track to end the holiday-shortened week higher. All major European indexes will be closed for Good Friday on ⁠April 3rd and Easter Monday on April 6th. Data released on Thursday showed that Switzerland’s annual inflation rate rose to 0.3% last month, its highest level since March of last year, as the conflict in the Middle East drove oil prices higher. Separately, data showed that Italy’s monthly retail sales were unchanged in February. Meanwhile, Eurozone government bond yields climbed on Thursday as a fresh jump in oil prices prompted traders to raise bets on European Central Bank interest rate hikes. Money markets are pricing in at least three 25-basis-point ECB interest rate hikes by the end of this year. In corporate news, Stellantis NV (STLAP.FP) rose over +1% after Bloomberg News reported that the carmaker was exploring options to build electric vehicles in Canada with its Chinese partner Zhejiang Leapmotor Technology.

Switzerland’s CPI and Italy’s Retail Sales data were released today.

Switzerland’s March CPI rose +0.2% m/m and +0.3% y/y, weaker than expectations of +0.5% m/m and +0.5% y/y.

The Italian February Retail Sales were unchanged m/m, weaker than expectations of +0.3% m/m.

Asian stock markets today settled in the red. China’s Shanghai Composite Index (SHCOMP) closed down -0.74%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -2.38%.

China’s Shanghai Composite Index closed lower today, tracking regional declines as U.S. President Trump’s address dashed investor hopes for a swift de-escalation of the Middle East conflict. President Trump offered no clear timeline for ending the Middle East conflict in a televised speech and instead cautioned that more strikes on Iran would follow in the weeks ahead. Semiconductor stocks were among the biggest losers on Thursday. Limiting losses, energy stocks climbed amid a jump in oil prices. Also, shares of automakers mostly rose after many reported a rebound in March sales from weaker performance earlier this year. Meanwhile, HSBC analysts said in a note on Thursday that China’s equity markets provide investors with solid diversification and resilience amid the Middle East conflict, citing signs of a structural earnings recovery for corporates. In other news, China’s central bank drained liquidity from its financial system for the first time in a year, a cautious move that preserves policy flexibility as higher oil prices ripple through the economy. The People’s Bank of China withdrew a total of 890 billion yuan ($129 billion) in liquidity through short-term open market operations in March and absorbed an additional 250 billion yuan via longer-term instruments. Lynn Song, chief economist for Greater China at ING Bank, said that policymakers want to “save bullets for the future when more injections are needed.”

Japan’s Nikkei 225 Stock Index reversed earlier gains and closed sharply lower today as oil prices jumped after U.S. President Trump signaled further U.S. military strikes on Iran. Trump said Washington’s core objectives in the Iran war were close to being achieved, but warned that the U.S. would strike Iran “extremely hard” over the next two to three weeks, dampening hopes for an imminent end to the five-week-old war. Energy, utility, and technology stocks led the declines on Thursday. NLI Research Institute researcher Yusuke Maeyama said that the Japanese market could decline further as corporate earnings face risks from rising oil prices driven by the Middle East conflict. Maeyama noted that a renewed escalation or prolonged conflict could push Japanese stocks below their March lows, potentially driving the Nikkei under the 50,000 mark. Meanwhile, Japanese government bond yields surged on Thursday amid renewed inflation concerns and a weak outcome of Japan’s auction of 10-year sovereign securities. Ryutaro Kimura, a senior fixed-income strategist at Axa Investment Managers, said, “Bond investors appear to have hesitated to bid after President Trump’s speech. Concerns about a further worsening of energy supply vulnerabilities from the Middle East are likely to increase inflationary pressures for Japan and create upward pressure on interest rates.” In other news, foreign investors sold a net 4.45 trillion yen ($27.92 billion) worth of Japanese stocks in the week through March 28th, marking their largest weekly net outflow since at least January 2005, according to Ministry of Finance data. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +60.23% to 42.35.

Pre-Market U.S. Stock Movers

The Magnificent Seven stocks slipped in pre-market trading amid risk-off sentiment, with Nvidia (NVDA) and Tesla (TSLA) falling over -2%.

Chip and AI-infrastructure stocks sank in pre-market trading, with Sandisk (SNDK) slumping over -5% and Micron Technology (MU) sliding more than -4%.

Mining stocks slumped in pre-market trading as gold and silver prices tumbled, with Newmont (NEM) dropping over -4% and Freeport McMoRan (FCX) falling more than -3%.

Airline stocks slid in pre-market trading amid a jump in oil prices, with United Airlines Holdings (UAL) falling over -4% and Delta Air Lines (DAL) dropping more than -3%.

Globalstar (GSAT) surged more than +10% in pre-market trading after the Financial Times reported that Amazon was in talks to acquire the company.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Thursday - April 2nd

Acuity (AYI), Lindsay (LNN), Trilogy Metals (TMQ), AngioDynamics (ANGO), NervGen Pharma (NGEN), Namib Minerals (NAMM).

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